Aviva Petroleum Inc - Final Results
29 Marzo 1999 - 6:29PM
UK Regulatory
RNS No 9064k
AVIVA PETROLEUM PLC
29 March 1999
AVIVA REPORTS 1998 RESULTS
29th March, 1999
Aviva Petroleum Inc. ("AVP") the Dallas based oil and gas exploration and
production company reports a net loss of $17,078,000 ($.50 per common share)
for the year ended December 31, 1998 compared with a net loss of $22,482,000
($.71 per common share) for 1997. Revenues in 1998 decreased by 66% to
$3,332,000 (1997 - $9,726,000), due to lower sales volumes in Colombia and the
United States and severely depressed oil prices. Production expenses
decreased to $3,525,000 (1997 - $4,235,000) and general administrative expense
was reduced to $1,074,000 (1997 - $1,510,000). Depletion, depreciation and
amortization charges declined to $3,152,000 (1997 - $6,067,000). However,
major write-downs of oil and gas property carrying values, which occurred and
were reported throughout the year totaled $12,343,000 (1997 - $19,953,000) by
year-end, and were the largest component of the final net loss. Cash flow
from operations was essentially break-even at ($49,000) down from $1,731,000
in 1997.
Pre-tax present value of estimated future net revenues from proved reserves
was approximately $5 million at year-end 1998 down from $11 million at the end
of 1997. Year-end 1998 proved oil reserves in the U.S. and Colombia were 2.4
million barrels, and U.S. gas reserves were 4 million cubic feet (1.7 million
barrels and 1.1 billion cubic feet in 1997). The increase in oil reserves was
accounted for by the acquisition of Garnet Resources Corporation in October
1998.
Ron Suttill, Chief Executive of Aviva, commenting on the results, said: "1998
was a disastrous year for the oil industry in general and smaller companies in
particular. Aviva's revenues and asset values were again, as in 1997,
severely affected by the precipitous fall in world oil prices. In Colombia,
the 1998 year-end oil price was US $7.50 per barrel, down from US $14.30 at
the end of 1997, and in the US the 1998 year-end price was down to $9.28 from
$16.41 per barrel at year-end 1997. These fundamentals were compounded in our
case by unusually adverse weather conditions in the Gulf of Mexico and
increased guerrilla activity in our Colombian operations area."
"Despite this backdrop of chaotic industry conditions we have continued to
look for merger opportunities, and on March 4, 1999 announced the signing of a
letter of intent with Sharpe Resources Corporation, an Ontario company listed
on the Montreal Stock Exchange. The proposed transaction has been
discussed in detail with our lenders, who have provided a waiver for events of
non-compliance under our loan agreement to facilitate continuation of
discussions with Sharpe. Our auditors, in their report on the 1998 results,
have given us a "going concern" qualification, which in essence confirms that
absent a Sharpe deal, and significant debt-restructuring, there is substantial
doubt that Aviva can continue as a going concern."
On March 25, the company was advised that the American Stock Exchange (AMEX)
Adjudicatory Council had affirmed a decision to remove Aviva Petroleum Inc.
from listing and registration on the Exchange. The Exchange has advised that
the last trading day for Aviva Depositary Shares on AMEX will be Friday, April
9, and we expect that a continuing market for Depositary Shares (each of which
represents 5 common shares) will develop over the counter.
The Company is engaged in exploration for and development and production of
oil and gas in Colombia, offshore the United States, and in Papua New Guinea.
Safe Harbor for Forward-Looking Statements: Except for historical information
contained herein, the statements in this press release are forward-looking
statements that are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements involve
known and unknown risks and uncertainties which may cause the Company's actual
results in future periods to differ materially from forecasted results. These
risks and uncertainties include, among other things, general economic
conditions, volatility of oil and gas prices, the impact of possible
geopolitical occurrences world-wide, imprecision of reserve estimates, changes
in laws and regulations, unforeseen engineering and mechanical or
technological difficulties in drilling or working-over wells, and other risks
described in the Company's filings with the Securities and Exchange
Commission.
Further Information:
Ron Suttill
Aviva Petroleum Inc.
001 214 691 3464
George Collie
George Collie & Company
0171 603 7765
AVIVA PETROLEUM INC. AND SUBSIDIARIES
Consolidated Statement of Operations
Years Ended December 31, 1998 and 1997
(in thousands, except per share data)
1998 1997
Oil and gas sales $ $
3,332 9,726
Expense:
Production
3,525 4,235
Depreciation, depletion and amortization
3,152 6,067
Write-down of oil and gas properties
12,343 19,953
General and administrative
1,074 1,510
Provision for losses on accounts
receivable 420 -
Total expense
20,514 31,765
Other income (expense):
Interest and other income (expense), net
1,045 122
Interest expense
(748) (658)
Total other income (expense)
297 (536)
Loss before income taxes and
extraordinary item (16,885) (22,575)
Income (taxes) benefits
4 93
Loss before extraordinary item
(16,881) (22,482)
Extraordinary item - debt extinguishment
(197) -
Net loss $ $
(17,078) (22,482)
Weighted average common shares outstanding
34,279 31,483
Basic and diluted net loss per common share $ $
(0.50) (0.71)
END
FR CCCCBADKDBNB
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