First Nine Months Record Oil
Production Drives EBITDAX to $384 million
EPL to Acquire New 3D Seismic Covering 200 GOM
Shelf Blocks (~1 million acres)
EPL Oil & Gas, Inc. (EPL or the Company) (NYSE:EPL) today
reported financial and operational results for the third quarter
and first nine months of 2013.
Highlights
- 3Q13 EBITDAX rose 144% versus 3Q12 to $127.5 million and
adjusted non-GAAP net income rose 149% versus 3Q12 to $31.4
million, or $0.81 per diluted share (see reconciliation of EBITDAX
and adjusted non-GAAP net income in the tables)
- 3Q13 discretionary cash flow rose 135% versus 3Q12 to $112.7
million, or $2.92 per share (see reconciliation of discretionary
cash flow in the tables)
- 3Q13 oil production at 17,481 Bbls of oil per day, 96% higher
than 3Q12
- 3Q13 total production at 23,097 Bbls of oil equivalent per day,
113% higher than 3Q12
- First nine months capital expenditures of $258.3 million; 32
successful projects to date (84% success rate)
- Production levels expected in 4Q13 primarily impacted by
reduced production rates post storm of certain high-rate wells in
the West Delta field area shut-in during Tropical Storm Karen. Rig
sourced and mobilizing to area in mid-December to begin production
uplift. Impact to forecasted 2013 oil production is approximately
7%
- Projected 2013 EBITDAX of $475 million (66% increase over
2012)
- Low leverage and ample liquidity: current net debt to projected
2013 EBITDAX estimated at 1.3x; liquidity in the form of cash plus
undrawn revolver availability estimated at $303 million
- Efforts underway to unlock 3P resource potential: Recently
signed seismic commitments totaling $45 million, including a
multi-year commitment to acquire new 3D seismic covering 200 blocks
(~1 million acres) within the shallow GOM. New 3D seismic
acquisition to commence over core areas as early as 2Q14. The new
3D seismic combined with state of the art reprocessed datasets is
expected to provide uplift necessary to exploit both the deep and
shallow section of the Company's asset base
Financial Results
Revenue for the third quarter and first nine months of 2013 was
$184.0 million and $550.4 million, respectively. Revenue for the
third quarter and the first nine months of 2013 increased 112% and
93% respectively versus prior periods, driven by higher realized
oil production from the Company's oil-weighted acquisitions and
organic exploitation projects.
For the third quarter of 2013, EPL reported a net loss to common
stockholders of $1.3 million, or $0.03 per diluted share, compared
to a net loss of $2.2 million, or $0.06 per diluted share for the
same period a year ago. The net loss for the quarter included $26.5
million of non-cash unrealized losses on derivative instruments and
$24.9 million of costs primarily attributable to loss on
abandonment activities. These abandonment costs include $21.8
million in abandonment costs related to four wellbores in our
non-operated deepwater properties, which are related to investments
made prior to the Company's reorganization in 2009. These increased
deepwater abandonment costs are primarily attributable to changes
in regulatory interpretations and enforcement by the federal
regulators in the deepwater that increased the required scope of
work. Excluding the impact of these items, EPL's adjusted
third quarter net income, a non-GAAP measure, would have been $31.4
million, or $0.81 per diluted share, compared to $12.6 million, or
$0.33 per diluted share, for the same period a year ago.
For the nine months ended September 30, 2013, net income was
$97.3 million, or $2.48 per diluted share, compared to net income
of $34.7 million, or $0.88 per diluted share for the same period a
year ago. Net income for the first nine months of 2013 included
$28.6 million total gains on sale of assets and $38.4 million of
costs primarily attributable to loss on abandonment activities
(including the increased deepwater costs described above for the
third quarter). Excluding the impact of these items, EPL's adjusted
net income for the first nine months of 2013, a non-GAAP measure,
would have been net income of $103.6 million, or $2.64 per diluted
share compared to $49.3 million, or $1.26 per diluted share, for
the same period a year ago.
For the third quarter of 2013, EBITDAX was $127.5 million and
discretionary cash flow was $112.7 million, or $2.92 per share (see
reconciliation of EBITDAX and discretionary cash flow in the
tables). Cash flow from operating activities in the third quarter
of 2013 was $116.7 million, compared with cash flow from operating
activities of $54.4 million in the same quarter a year
ago.
For the first nine months of 2013, EBITDAX was $384.0 million
and discretionary cash flow was $347.6 million, or $8.86 per
share (see reconciliation of EBITDAX and discretionary cash flow in
the tables). Cash flow from operating activities in the first nine
months of 2013 was $309.2 million compared to $162.6 million for
the same period a year ago.
Production and Price Realizations
Oil production for the third quarter of 2013 averaged 17,481
Barrels (Bbls) per day. Oil production volumes were 96% higher than
in the comparable quarter last year, primarily as a result of
organic oil production growth within EPL's existing core fields and
the Hilcorp acquisition of oil-weighted properties that closed late
last year.
Natural gas production averaged 33.7 million cubic feet (Mmcf)
per day in the third quarter of 2013. Although EPL has
continued its focus on oil development opportunities that have
higher revenue generation potential than natural gas, with minimal
expenditures, the Company has realized solid performance from its
natural gas assets during the first nine months of this
year.
Price realizations for the third quarter of 2013, all of which
are stated before the impact of derivative instruments, averaged
$110.88 per barrel for crude oil and $3.63 per thousand cubic feet
(Mcf) of natural gas, compared to $105.35 per barrel of crude oil
and $3.00 per Mcf of natural gas in the same quarter a year ago.
The Company's crude oil is advantaged by receiving Heavy Louisiana
Sweet and Light Louisiana Sweet crude oil basis
differentials.
Oil production for the first nine months of 2013 averaged 17,554
Bbls per day, which was 88% higher than the comparable period a
year ago. Natural gas production averaged 34.1 Mmcf per day in the
first nine months of 2013. Price realizations, all of which are
stated before the impact of derivative instruments, averaged
$110.02 per barrel for crude oil and $3.78 per Mcf of natural gas
in the first nine months of 2013, compared to $110.25 per barrel of
crude oil and $2.55 per Mcf of natural gas in the same period a
year ago.
Operating Expenses
Lease operating expenses (LOE) for the third quarter of 2013
totaled $42.3 million, including approximately $2 million of
non-routine workover expenses. General and administrative (G&A)
expenses were $6.4 million during the third quarter of 2013.
Reported expenses include non-cash stock based compensation
recorded during the quarter of $1.9 million.
LOE for the first nine months of 2013 totaled $126.7 million,
while G&A expenses were $20.9 million for the same period.
Reported LOE and G&A increased over the same periods a year ago
mainly due to costs associated with our expanded asset base.
Reported expenses for the first nine months of 2013 include
non-cash stock based compensation of $5.4 million.
Capital Expenditures and P&A
Operations
During the first nine months of 2013, costs incurred for
development and exploration activities totaled approximately $255.0
million, which combined with $3.3 million spent on seismic
purchases, resulted in total expenditures of $258.3 million. So far
to date this year, the Company has conducted 38 operations,
including 14 successful sidetracks and drillwells and 18 successful
workover and well reactivations, with an overall 84% success
rate.
The Company currently expects capital expenditures to total
approximately $335 million in 2013. Development and infield
exploration spending is budgeted primarily in the West Delta, East
Bay, South Timbalier, Ship Shoal, and South Pass core field areas.
The Company has continued its active drilling and workover program
with 5 rigs expected to be working within its core field areas
during the remainder of the year. In addition, EPL expects to spend
approximately $46 million for plugging and abandonment and other
decommissioning activities. The Company spent approximately $36.8
million in the first nine months of 2013 on these activities.
EPL to Acquire New 3D Seismic Over Core Central GOM
Shelf
EPL has recently signed 3D seismic commitments totaling
approximately $45 million. These agreements include a commitment to
acquire new 3D seismic using wide azimuth acquisition techniques
covering a minimum of 200 blocks (~1 million acres) within the
shallow water GOM. This new seismic acquisition, combined with
state of the art 3D reprocessed datasets, are expected to enhance
clarity and de-risk vast resources in the deep and shallow section
of the Company's asset base. The new 3D Full Azimuth Nodal seismic
data acquisition to be conducted by Fairfieldnodal is expected to
commence late second quarter of 2014. During the fourth quarter of
2013, the Company expects to incur approximately $8 million of
exploration expenses related to these seismic agreements.
Gary C. Hanna, the Company's Chairman, President and CEO,
stated, "We have taken a measured step forward on our regional
seismic and reprocessing efforts by becoming a major underwriter in
new seismic acquisitions in the central GOM shelf. This new
multi-year seismic commitment, covering a minimum of one million
acres, will blanket our core areas and employ state of the art
technology designed to image the deeper section while continuing to
enhance the shallow. Additionally, we will also continue to
utilize ever-improving reprocessing techniques, such as reverse
time migration and inversion, to further drive our exploration and
acquisition efforts both in the known producing pays and in the
deeper, largely untested section."
Liquidity and Capital Resources
As of September 30, 2013, the Company had cash on hand of $2.9
million and long-term restricted cash of $6.0 million. EPL has a
$750 million senior secured credit facility, with a current
borrowing base of $425 million. As previously announced in
April, 2013, we sold our Bay Marchand interests to the property
operator for $51.5 million in cash and the buyer's assumption of
liabilities recorded on our balance sheet of $11.3 million
resulting in total consideration of $62.8 million, subject to
customary adjustments to reflect the January 1, 2013 economic
effective date. The cash proceeds from this sale of assets
were deposited with a qualified intermediary in contemplation of a
potential tax-deferred exchange of properties and classified as
restricted cash at June 30, 2013. On September 26, 2013, $16.5
million of the proceeds were used to fund an acquisition of 100% of
the working interest of certain Gulf of Mexico shelf oil and
natural gas interests within the West Delta 29 field. On
September 29, 2013, the underlying escrow agreement expired, and
the remaining amount of the deposit became
unrestricted. As a result, as of September 30, 2013,
EPL had reduced its borrowings under its credit facility to $125
million, a reduction of $40 million since the prior quarter
end.
EPL's current liquidity, in the form of cash plus undrawn
revolver availability is approximately $303 million. Based on the
solid performance of its assets, EPL's current leverage remains
low, estimated at 1.3x net debt to projected 2013 EBITDAX using the
midpoint of the guidance. (See the guidance section contained in
this press release and the discussion of EBITDAX in the
tables).
2013 and 2014 Hedge Position
The Company has layered in downside protection to protect its
cash flow, mainly in the form of Louisiana Light Sweet (LLS) and
Brent oil swaps. For the fourth quarter of 2013, EPL has a total of
8,045 Bbls of oil per day hedged, the majority of which is hedged
using Brent swaps at a fixed price averaging $104.45 per Bbl. For
full year 2014, EPL has a total of 10,996 Bbls of oil per day
hedged, all of which is hedged using LLS and Brent swaps at a fixed
price averaging $99.54 per Bbl. For the fourth quarter of 2013, EPL
has a total of 7,332 Mcf per day of gas hedged, all of which is
hedged using swaps at a fixed price averaging $3.68 per Mcf. For
full year 2014, EPL has a total of 5,000 Mcf per day of gas hedged,
all of which is hedged using swaps at a fixed price averaging $4.01
per Mcf.
Fourth Quarter and Full Year 2013 Guidance
Hanna concluded, "We are seeing some disruptions within this
quarter, namely a week or so of downtime from tropical storm Karen
and ongoing curtailed production from a third party pipeline
shut-in that began last week. Additionally following the storm, as
we worked to restore production, we have seen a significant
performance drop off isolated to three high rate oil wells within
our West Delta area shut-in during the event. Despite the drop, the
wells are still highly economic, with production already exceeding
our proved reserves to date and behind pipe opportunities we can
recomplete to once the current zones deplete.
We have sourced a new rig to add to our active drilling program
that is now set to mobilize to the West Delta field area as early
as mid-December to begin executing projects within this prospect
rich area. We are confident that this effort and our ongoing
operations elsewhere will act to uplift our oil production.
However, our fourth quarter oil production averages will suffer
from this event and the other disruptions. Therefore, we are
decreasing our 2013 annual forecasted oil production by roughly 7%
to approximately 17,000 Bbls of oil per day, and we are forecasting
our exit rate to be around 17,500 Bbls of oil per day. Despite this
change and the recent decrease in oil prices, our projected 2013
EBITDAX remains high at approximately $475 million, up 66% from
last year."
ESTIMATED PRODUCTION
& SWAP HEDGE VOLUMES |
Note: 4Q13/Full Yr 2013
production guidance impacted by the following: the downtime
associated with fields shut-in during TS Karen, reduced rates post
TS Karen isolated to the West Delta area, and 3rd party pipeline
intregrity testing late Oct/early Nov affecting West Delta and
South Pass field areas. |
|
|
|
|
|
|
|
|
|
Net Production (per day) |
|
|
4Q 2013 |
Full Year
2013 |
Oil, including NGLs (Bbls) |
|
|
14,750 |
- |
15,750 |
16,850 |
- |
17,100 |
Natural gas (Mcf) |
|
|
24,000 |
- |
30,000 |
31,500 |
- |
33,000 |
Boe |
|
|
18,750 |
- |
20,750 |
22,100 |
- |
22,600 |
% Oil, including
NGLs (using midpoint of guidance) |
|
|
77% |
|
|
76% |
|
|
|
|
|
|
|
|
|
|
Swap Contracted Volume |
|
|
|
|
|
|
|
|
Oil (barrels) |
|
|
|
7,045 |
|
|
10,157 |
|
% of Oil swap contracted |
|
|
|
46% |
|
60% |
- |
59% |
% of Boe swap contracted |
|
|
|
36% |
|
46% |
- |
45% |
Average Swap Price Level |
|
|
|
$103.63 |
|
|
$104.62 |
|
|
|
|
|
|
|
|
|
|
ESTIMATED EXPENSES (in
Millions, unless otherwise noted) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lease Operating (including
energy insurance) |
|
|
$ 41.0 |
- |
$ 44.0 |
$ 168 |
- |
$ 171 |
General &
Administrative (cash and non-cash) |
|
$ 7.0 |
- |
$ 7.5 |
$ 28 |
- |
$ 29 |
Taxes, other than on
earnings |
|
|
$ 2.5 |
- |
$ 3.5 |
$ 11 |
- |
$ 12 |
Exploration Expense |
|
|
$ 11 |
- |
$ 13 |
$ 21 |
- |
$ 23 |
DD&A ($/Boe), excluding
accretion |
|
|
$ 25.50 |
- |
$ 27.00 |
$ 25.50 |
- |
$ 27.00 |
DD&A ($/Boe), including
accretion |
|
|
$ 28.50 |
- |
$ 30.00 |
$ 28.50 |
- |
$ 30.00 |
Interest Expense
(including amortization of discount and deferred financing
costs) |
$ 12.5 |
- |
$ 13.5 |
$ 51 |
- |
$ 53 |
|
|
|
|
|
|
|
|
|
ESTIMATED EBITDAX: |
$475 |
Million |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ESTIMATED FREE CASH
FLOW: |
$55 |
Million |
|
|
|
|
|
|
Conference Call Information
EPL has scheduled a conference call for today, October 31, 2013,
at 9:30 A.M. Central Time/10:30 A.M. Eastern Time to review results
for the third quarter 2013 and to discuss its outlook for the
remainder of the year. To participate in the EPL conference call,
callers in the United States and Canada can dial (866) 845-8624 and
international callers can dial (706) 634-0487. The Conference I.D.
for callers is 88223861.
The call will be available for replay beginning two hours after
the call is completed through midnight of November 14, 2013. For
callers in the United States and Canada, the toll-free number for
the replay is (855) 859-2056. For international callers the number
is (404) 537-3406. The Conference I.D. for all callers to access
the replay is 88223861.
The conference call will be webcast live as well as for
on-demand listening at the Company's website, www.eplweb.com.
Listeners may access the call through the "Events and Webcasts"
link in the Investor Relations section of the site.
Description of the Company
Founded in 1998, EPL is an independent oil and natural gas
exploration and production company headquartered in Houston, Texas
with an office in New Orleans, Louisiana. The Company's
operations are concentrated in the U.S. Gulf of Mexico shelf,
focusing on the state and federal waters offshore
Louisiana. For more information, please visit
www.eplweb.com.
Forward-Looking Statements
This press release may contain forward-looking information and
statements regarding EPL. Any statements included in this
press release that address activities, events or developments that
EPL "expects," "believes," "plans," "projects," "estimates" or
"anticipates" will or may occur in the future are forward-looking
statements. We believe these judgments are reasonable, but
actual results may differ materially due to a variety of important
factors. Among other items, such factors might include:
hurricane and other weather-related interference with business
operations; the effects of delays in completion of, or shut-ins of,
gas gathering systems, pipelines and processing facilities; stock
market conditions; the trading price of EPL's common stock; cash
demands caused by planned and unplanned capital expenditures;
changes in general economic conditions; uncertainties in reserve
and production estimates, particularly with respect to internal
estimates that are not prepared by independent reserve engineers;
unanticipated recovery or production problems; changes in
legislative and regulatory requirements concerning safety and the
environment as they relate to operations and to abandonment of
wells and production facilities; oil and natural gas prices and
competition; the impact of derivative positions; production
expenses and expense estimates; cash flow and cash flow estimates;
future financial performance; drilling and operating risks; our
ability to replace oil and gas reserves; risks and liabilities
associated with properties acquired in acquisitions; integration of
acquired assets; volatility in the financial and credit markets or
in oil and natural gas prices; and other matters that are discussed
in EPL's filings with the Securities and Exchange Commission.
(http://www.sec.gov/)
EPL OIL & GAS,
INC. |
CONSOLIDATED STATEMENTS
OF OPERATIONS |
(In
thousands) |
(Unaudited) |
|
Three Months Ended |
Nine Months Ended |
|
September 30, |
September 30, |
|
2013 |
2012 |
2013 |
2012 |
Revenue: |
|
|
|
|
Oil and natural gas |
$ 183,114 |
86,645 |
$ 547,099 |
284,666 |
Other |
878 |
23 |
3,329 |
68 |
|
183,992 |
86,668 |
550,428 |
284,734 |
|
|
|
|
|
Costs and expenses: |
|
|
|
|
Lease operating |
42,291 |
24,995 |
126,663 |
62,067 |
Transportation |
974 |
160 |
2,317 |
410 |
Exploration expenditures and dry hole
costs |
5,146 |
966 |
13,609 |
17,862 |
Impairments |
12 |
498 |
2,183 |
6,206 |
Depreciation, depletion and
amortization |
53,989 |
27,106 |
153,847 |
78,932 |
Accretion of liability for asset
retirement obligations |
6,266 |
3,472 |
18,464 |
10,031 |
General and administrative |
6,426 |
5,995 |
20,927 |
16,993 |
Taxes, other than on earnings |
3,285 |
3,189 |
8,884 |
9,834 |
Gain on sale of assets |
(1,745) |
- |
(28,601) |
- |
Other |
26,534 |
998 |
33,077 |
4,616 |
Total costs and expenses |
143,178 |
67,379 |
351,370 |
206,951 |
|
|
|
|
|
Income from operations |
40,814 |
19,289 |
199,058 |
77,783 |
|
|
|
|
|
Other income (expense): |
|
|
|
|
Interest income |
64 |
40 |
91 |
128 |
Interest expense |
(13,177) |
(5,114) |
(39,370) |
(15,081) |
Loss on derivative instruments |
(30,012) |
(22,108) |
(7,033) |
(11,865) |
|
(43,125) |
(27,182) |
(46,312) |
(26,818) |
|
|
|
|
|
Income (loss) before income
taxes |
(2,311) |
(7,893) |
152,746 |
50,965 |
Provision for Income
taxes: |
|
|
|
|
Current |
(25) |
126 |
(175) |
(174) |
Deferred |
1,052 |
5,520 |
(55,239) |
(16,134) |
Total provision for income taxes |
1,027 |
5,646 |
(55,414) |
(16,308) |
|
|
|
|
|
Net income (loss) |
$ (1,284) |
(2,247) |
$ 97,332 |
34,657 |
|
|
|
|
|
Net income (loss), as
reported |
$ (1,284) |
(2,247) |
$ 97,332 |
34,657 |
Add back: |
|
|
|
|
Unrealized loss (gain) due to the change
in fair value of derivative instruments |
26,478 |
22,010 |
(822) |
8,052 |
Gain on sale of assets |
(1,745) |
- |
(28,601) |
- |
Dry hole costs |
73 |
(76) |
3,764 |
4,097 |
Impairments |
12 |
498 |
2,183 |
6,206 |
Loss on abandonment activities |
22,562 |
4 |
27,982 |
3,405 |
Amortization of weather derivative
premium |
4,022 |
1,029 |
5,333 |
1,371 |
Deduct: |
|
|
|
|
Income tax adjustment for above
items |
(18,710) |
(8,588) |
(3,581) |
(8,466) |
|
|
|
|
|
Adjusted Non-GAAP net
income |
$ 31,408 |
12,630 |
$ 103,590 |
49,322 |
|
|
|
|
|
EBITDAX Reconciliation: |
|
|
|
|
|
|
|
|
|
Net income (loss), as
reported |
$ (1,284) |
(2,247) |
$ 97,332 |
34,657 |
Add back: |
|
|
|
|
Income taxes |
(1,027) |
(5,646) |
55,414 |
16,308 |
Net interest expense |
13,113 |
5,074 |
39,279 |
14,953 |
Depreciation, depletion, amortization and
accretion |
60,255 |
30,578 |
172,311 |
88,963 |
Impairments |
12 |
498 |
2,183 |
6,206 |
Exploration expenditures and dry hole
costs |
5,146 |
966 |
13,609 |
17,862 |
Loss on abandonment activities |
22,562 |
4 |
27,982 |
3,405 |
Amortization of weather derivative
premium |
4,022 |
1,029 |
5,333 |
1,371 |
Gain on sale of assets |
(1,745) |
- |
(28,601) |
- |
Less impact of: |
|
|
|
|
Unrealized loss (gain) due to the change
in fair value of derivative instruments |
26,478 |
22,010 |
(822) |
8,052 |
|
|
|
|
|
EBITDAX |
$ 127,532 |
52,266 |
$ 384,020 |
191,777 |
|
|
|
|
|
Weighted average dilutive common
shares outstanding |
38,589 |
38,743 |
39,256 |
39,056 |
|
|
|
|
|
|
|
|
|
|
EBITDAX is defined as net
income (loss) before income taxes, net interest expense,
depreciation, depletion, amortization and accretion, impairments,
exploration expenditures and dry hole costs, loss on abandonment
activities, amortization of weather derivative premium, and gain on
sale of assets, and further deducts the unrealized gain or loss on
our derivative instruments. We have reported EBITDAX because we
believe EBITDAX is a measure commonly reported and widely used in
our industry as an indicator of a company's ability to internally
fund exploration and development activities and incur and service
debt. EBITDAX is not a calculation based on generally accepted
accounting principles (GAAP) in the United States and should not be
considered in isolation from or as a substitute for net income, as
an indication of operating performance or cash flows from operating
activities or as a measure of liquidity. Investors should
carefully consider the specific items included in our computation
of EBITDAX. Investors should be cautioned that EBITDAX as
reported by us may not be comparable in all instances to EBITDAX as
reported by other companies. In addition, EBITDAX does not
represent funds available for discretionary use. |
|
|
|
|
|
EPL OIL & GAS,
INC. |
CONSOLIDATED STATEMENTS
OF NET CASH PROVIDED BY |
OPERATING
ACTIVITIES |
(In
thousands) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
Nine Months Ended |
|
September 30, |
September 30, |
|
2013 |
2012 |
2013 |
2012 |
Cash flows from operating activities: |
|
|
|
|
Net income (loss) |
$ (1,284) |
(2,247) |
97,332 |
34,657 |
Adjustments to reconcile net
income (loss) to net cash provided by operating activities: |
|
|
|
Depreciation, depletion and
amortization |
53,989 |
27,106 |
153,847 |
78,932 |
Accretion of liability for asset
retirement obligations |
6,266 |
3,472 |
18,464 |
10,031 |
Unrealized loss (gain) on derivative
contracts |
26,478 |
22,010 |
(822) |
8,052 |
Non-cash compensation |
1,910 |
1,175 |
5,358 |
3,493 |
Deferred income taxes |
(1,052) |
(5,520) |
55,239 |
16,134 |
Exploration expenditures |
73 |
(76) |
3,764 |
4,097 |
Impairments |
12 |
498 |
2,183 |
6,206 |
Amortization of deferred financing costs
and discount on debt |
1,361 |
512 |
4,016 |
1,516 |
Gain on sale of assets |
(1,745) |
- |
(28,601) |
- |
Other |
22,562 |
4 |
27,982 |
3,405 |
Changes in operating assets and
liabilities: |
|
|
|
|
Trade accounts receivable |
8,542 |
4,270 |
(1,718) |
5,171 |
Prepaid expenses |
549 |
2,242 |
(5,308) |
4,062 |
Other assets |
(1,361) |
440 |
(1,077) |
362 |
Accounts payable and accrued
expenses |
10,457 |
8,852 |
15,345 |
14,149 |
Asset retirement obligation
settlements |
(10,072) |
(8,301) |
(36,843) |
(27,647) |
|
|
|
|
|
Net cash provided by operating
activities |
$ 116,685 |
54,437 |
309,161 |
162,620 |
|
|
|
|
|
Reconciliation of discretionary cash
flow: |
|
|
|
|
Net cash provided by operating
activities |
116,685 |
54,437 |
309,161 |
162,620 |
Changes in working capital |
(8,115) |
(7,503) |
29,601 |
3,903 |
Non-cash exploration expenditures and
impairments |
(85) |
(422) |
(5,947) |
(10,303) |
Total exploration expenditures, dry hole
costs and impairments |
4,200 |
1,464 |
14,834 |
24,068 |
Discretionary cash flow |
$ 112,685 |
47,976 |
347,649 |
180,288 |
|
|
|
|
|
|
|
|
|
|
The table above reconciles
discretionary cash flow to net cash provided by or used in
operating activities. Discretionary cash flow is defined as cash
flow from operations before changes in working capital and
exploration expenditures. Discretionary cash flow is widely
accepted as a financial indicator of an oil and natural gas
company's ability to generate cash which is used to internally fund
exploration and development activities, pay dividends and service
debt. Discretionary cash flow is presented based on management's
belief that this non-GAAP financial measure is useful information
to investors because it is widely used by professional research
analysts in the valuation, comparison, rating and investment
recommendations of companies within the oil and natural gas
exploration and production industry. Many investors use the
published research of these analysts in making their investment
decisions. Discretionary cash flow is not a measure of financial
performance under GAAP and should not be considered as an
alternative to cash flows from operating activities, as defined by
GAAP, or as a measure of liquidity, or an alternative to net
income. Investors should be cautioned that discretionary cash flow
as reported by the Company may not be comparable in all instances
to discretionary cash flow as reported by other companies. |
|
|
|
|
|
EPL OIL & GAS,
INC |
SELECTED PRODUCTION,
PRICING AND OPERATIONAL STATISTICS |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
Nine Months Ended |
|
September 30, |
September 30, |
|
2013 |
2012 |
2013 |
2012 |
|
|
|
|
|
PRODUCTION AND PRICING |
|
|
|
|
Net Production (per day): |
|
|
|
|
|
|
|
|
|
Crude Oil (Bbls) |
16,563 |
8,466 |
16,785 |
8,923 |
Natural Gas Liquids (Bbls) |
918 |
435 |
769 |
427 |
Oil (Bbls) |
17,481 |
8,901 |
17,554 |
9,350 |
Natural gas (Mcf) |
33,696 |
11,558 |
34,130 |
14,378 |
Total (Boe) |
23,097 |
10,827 |
23,242 |
11,746 |
Average Sales Prices: |
|
|
|
|
Crude Oil (per Bbl) |
$ 110.88 |
105.35 |
$ 110.02 |
110.25 |
Natural Gas Liquids (per Bbl) |
34.23 |
35.03 |
36.65 |
43.27 |
Oil (per Bbl) |
106.85 |
101.91 |
106.81 |
107.19 |
Natural gas (per Mcf) |
3.63 |
3.00 |
3.78 |
2.55 |
Average (per Boe) |
86.17 |
86.98 |
86.22 |
88.44 |
Oil and Natural Gas Revenues (in
thousands): |
|
|
|
|
Crude Oil |
$ 168,956 |
82,051 |
$ 504,160 |
269,568 |
Natural Gas Liquids |
2,891 |
1,402 |
7,690 |
5,061 |
Oil |
171,847 |
83,453 |
511,850 |
274,629 |
Natural gas |
11,267 |
3,192 |
35,249 |
10,037 |
Total |
183,114 |
86,645 |
547,099 |
284,666 |
|
|
|
|
|
Impact of derivative instruments settled
during the period(1): |
|
|
|
|
Oil (per Bbl) |
$ (2.18) |
(0.11) |
$ (1.53) |
(1.49) |
Natural gas (per Mcf) |
(0.01) |
(0.01) |
(0.05) |
- |
|
|
|
|
|
OPERATIONAL STATISTICS |
|
|
|
|
Average Costs (per Boe): |
|
|
|
|
Lease operating expense |
$ 19.90 |
25.09 |
$ 19.96 |
19.28 |
Depreciation, depletion and
amortization |
25.41 |
27.21 |
24.25 |
24.52 |
Accretion expense |
2.95 |
3.49 |
2.91 |
3.12 |
Taxes, other than on earnings |
1.55 |
3.20 |
1.40 |
3.06 |
General and administrative |
3.02 |
6.02 |
3.30 |
5.28 |
|
|
|
|
|
(1)The derivative amounts
represent the realized portion of gains or losses on derivative
instruments settled during the period which are included in Other
income (expense) in the consolidated statements of operations. |
|
|
|
EPL OIL & GAS,
INC. |
CONSOLIDATED BALANCE
SHEETS |
(In thousands, except
share data) |
(Unaudited) |
|
September 30, |
December 31, |
|
2013 |
2012 |
|
|
|
ASSETS |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$ 2,939 |
$ 1,521 |
Trade accounts receivable - net |
68,748 |
67,991 |
Fair value of commodity derivative
instruments |
972 |
3,302 |
Deferred tax asset |
4,414 |
3,322 |
Prepaid expenses |
14,454 |
9,873 |
Total current assets |
91,527 |
86,009 |
|
|
|
Property and equipment |
2,299,323 |
2,025,647 |
Less accumulated depreciation, depletion,
amortization and impairments |
(569,124) |
(427,580) |
Net property and equipment |
1,730,199 |
1,598,067 |
|
|
|
Restricted cash |
6,023 |
6,023 |
Fair value of commodity derivative
instruments |
675 |
211 |
Deferred financing costs --- net of
accumulated amortization |
10,851 |
12,386 |
Other assets |
4,023 |
2,931 |
|
$ 1,843,298 |
$ 1,705,627 |
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
Current liabilities: |
|
|
Accounts payable |
$ 55,410 |
$ 34,772 |
Accrued expenses |
103,160 |
117,372 |
Asset retirement obligations(1) |
47,482 |
30,179 |
Fair value of commodity derivative
instruments |
10,694 |
10,026 |
Deferred tax liabilities |
- |
- |
Total current liabilities |
216,746 |
192,349 |
|
|
|
Long-term debt |
621,723 |
689,911 |
Asset retirement obligations(1) |
240,288 |
204,931 |
Deferred tax liabilities |
124,025 |
67,694 |
Fair value of commodity derivative
instruments |
281 |
3,637 |
Other |
1,158 |
1,132 |
|
1,204,221 |
1,159,654 |
|
|
|
Commitments and contingencies |
|
|
|
|
|
Stockholders' equity: |
|
|
Preferred stock, $0.001 par value per
share. Authorized 1,000,000 shares; no shares issued and
outstanding at September 30, 2013 and December 31, 2012 |
- |
- |
Common stock, $0.001 par value per share.
Authorized 75,000,000 shares; shares issued 40,948,737 and
40,601,887 at September 30, 2013 and December 31, 2012,
respectively; shares outstanding 39,083,424 and 39,103,203 at
September 30, 2013 and December 31, 2012, respectively |
40 |
40 |
Additional paid-in capital |
516,690 |
510,469 |
Treasury stock, at cost, 1,865,313 and
1,498,684 shares at September 30, 2013 and December 31, 2012,
respectively |
(30,926) |
(20,477) |
Retained earnings |
153,273 |
55,941 |
Total stockholders' equity |
639,077 |
545,973 |
|
$ 1,843,298 |
$ 1,705,627 |
|
(1)We revise our
estimates of ARO as information about material changes to the
liability becomes known. During the three months ended September
30, 2013, we recorded revisions to our ARO liability related to our
shallower-water assets of $31.0 million. This does not affect
current results of operations, but increases the carrying amount of
the related assets and will result in higher DD&A including
accretion expense in future periods. |
CONTACT: Investors/Media
T.J. Thom, Chief Financial Officer
713-228-0711
tthom@eplweb.com
Grafico Azioni Energy Partners (NYSE:EPL)
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