VAALCO Energy, Inc. (NYSE:EGY) today reported operational and
financial results for the first quarter 2017.
First Quarter 2017 and recent key items:
- Reported income from continuing operations of $4.4
million or $0.07 earnings per share for the first quarter of 2017,
compared with a loss from continuing operations of $15.4 million or
a loss of $0.26 per share in the same period in 2016
- Generated operating income of $8.1 million in the first
quarter of 2017 and Adjusted EBITDAX of $10.4 million
- Produced an average of 4,622 barrels of oil per day
(BOPD) in the first quarter of 2017, above the high end of the
guidance range of 4,500 to 4,600 BOPD
- Successfully completed workovers on the South Tchibala
2H and Avouma 2H wells
- Reported first quarter 2017 production expense of
$20.44 per barrel of oil, excluding workovers, at the low end of
the guidance range of $20.00 to $23.00 per
barrel.
For the first quarter of 2017, VAALCO reported
income from continuing operations of $4.4 million, or $0.07 per
diluted share. In the same period in 2016, the Company reported a
loss from continuing operations of $15.4 million, or a loss of
$0.26 per diluted share. The average realized price for crude oil
in the first quarter of 2017 was $51.99 per barrel, up 92% from
$27.07 per barrel in the first quarter of 2016. Adjusted
EBITDAX totaled $10.4 million in the first quarter of 2017 compared
with a loss of $10.7 million in the same period of 2016.
Adjusted EBITDAX is a Non-GAAP financial measure
and is described and reconciled to net income (loss) in the
attached table under “Non-GAAP Financial Measures.”
Cary Bounds, VAALCO’s Chief Executive Officer
commented: “We continue to enhance value by delivering solid
production results and minimizing costs. We successfully completed
two well interventions utilizing a cost effective hydraulic
workover unit versus the traditional method of mobilizing a more
expensive drilling rig. VAALCO produced 4,622 BOPD of net
production which, coupled with improved pricing, allowed us to grow
operating income and Adjusted EBITDAX significantly versus the
fourth quarter 2016. Our focus in 2017 is to maximize margins
through operational excellence and continue to execute on our
corporate strategy while evaluating opportunistic
transactions.”
Bounds continued, “Financially, in the first
quarter we reported earnings per share of $0.07, our highest
earnings per share since the second quarter of 2014. Operationally,
we delivered production above the high end of our guidance range
and costs at the low end of the guidance range. We continue our
evaluation of development opportunities on our offshore Gabon
asset, and we are seeking similar growth opportunities in West
Africa, where we can leverage our strong operational and technical
expertise. We look to carry the positive momentum from the first
quarter results forward into 2017.”
Additional IFC Funding
On March 14, 2017, VAALCO borrowed $4.2 million
of additional funds under its Supplemental Agreement with the
International Finance Corporation (IFC) which was executed June 29,
2016. The borrowed funds will provide added financial flexibility
and facilitate execution of VAALCO’s corporate strategy. The
additional borrowings will be repaid in five quarterly principal
installments commencing June 30, 2017, together with interest which
will accrue at LIBOR plus 5.75%.
At March 31, 2017, debt, net of deferred
financing costs, totaled $15.0 million, of which $8.3 million was
classified as current, reflecting the repayment terms of the new
loan agreement with the IFC.
Sale of U.S. Properties
On October 17, 2016, the Company signed a letter
of intent to sell its entire acreage interests in the East Poplar
Unit in Montana for $250,000 and the assumption of asset retirement
obligations. The transaction closed on April 3, 2017.
Gabon and Equatorial Guinea
In the first quarter of 2017, production
increased 26% from 3,682 BOPD in the fourth quarter of 2016 to
4,622 BOPD. The Company was able to maintain and optimize
production for the quarter following the successful workover
operations that brought the South Tchibala 2-H and the Avouma 2-H
wells back on production.
VAALCO continues to examine alternative, lower
cost development options for discoveries in the Mutamba Iroru
permit onshore Gabon, and in Block P offshore Equatorial Guinea.
These discoveries present unique development opportunities that
will be re-evaluated as prices continue to recover.
Discontinued Operations -
Angola
The loss from discontinued operations in the
first quarter of 2017 totaled $0.2 million, or $0.00 loss per
diluted share. The small loss from these discontinued operations
for this quarter related to ongoing administrative costs. In
the first quarter of 2016, there was income from discontinued
operations of $7.8 million, or $0.13 per diluted share which
includes $7.6 million of bad debt recovery and $3.2 million of
collected default interest partially offset by the associated tax
expense of $3.0 million.
2017 First Quarter Financial
Results
Total oil and natural gas sales for the first
quarter of 2017 were $21.3 million, compared to $11.0 million for
the same period in 2016. During the first quarter of 2017, VAALCO
sold approximately 394,000 net barrels of oil at an average price
of $51.99 per barrel, compared to 381,000 net barrels at an average
price of $27.07 per barrel in the first quarter of 2016. First
quarter 2017 revenue was positively impacted by the increase in
realized pricing and by increased sales volumes compared to the
first quarter of 2016.
Costs and Expenses
Total production expense, excluding workovers,
was $8.1 million, or $20.44 per BOE of sales, for the first quarter
of 2017, compared to $7.0 million, or $18.03 per BOE of sales, for
the first quarter of 2016. The first quarter of 2017 included
additional customs fees of $0.5 million.
Depreciation, depletion and amortization
(DD&A) expense was $1.9 million, or $4.74 per BOE of sales in
the three months ended March 31, 2017 compared to $2.2 million, or
$5.81 per BOE in the comparable period in 2016.
General and administrative (G&A) expense for
the three months ended March 31, 2017 was $3.1 million, or $7.94
per BOE, as compared to $2.2 million, or $5.82 per BOE in the three
months ended March 31, 2016. While the Company has taken
significant steps to reduce overall G&A costs over the past 18
months, with decreases realized in personnel costs, incentive
compensation, services and various other cost categories, the
reduced drilling activity limits the amount of overhead that VAALCO
can recover from its partners. General and administrative expense
includes $0.2 million and $0.4 million of non-cash compensation
expense for the quarters ended March 31, 2017 and March 31,
2016.
Income tax expense for the first quarter of 2017
was $3.2 million compared to $1.7 million for the same period in
2016. The increase in tax compared to the same period a year
ago is primarily attributable to higher revenues from the Company’s
operations in Gabon.
Hedging
In order to limit VAALCO’s commodity price risk,
in 2016 the Company purchased crude oil puts for part of its 2017
volume. As of March 31, 2017, VAALCO had unexpired crude oil put
contracts covering 540,000 barrels of anticipated sales volumes for
the period from April 2017 through December 31, 2017 at a weighted
average price of $49.63. The Company recorded a non-cash
mark-to-market charge of $0.2 million related to the puts during
the first quarter of 2017 which was included in other, net in the
Condensed Consolidated Statements of Operations. The Company has
not entered into additional derivative contracts since March 31,
2017.
Capital Investments/Balance
Sheet
During the three months ended March 31, 2017,
the Company did not undertake any new capital projects. The capital
expenditures on a cash basis were $0.8 million primarily for
equipment and enhancements.
At the end of the first quarter, VAALCO had an
unrestricted cash balance of $24.2 million. This does not
include an additional $0.8 million in restricted cash (related
primarily to deposits in Gabon) classified as current assets or the
additional $0.9 million of restricted cash classified as long
term.
Conference Call
As previously announced, the Company will hold a
conference call to discuss its first quarter financial and
operating results tomorrow, Tuesday, May 9, 2017, at 8:00 a.m.
Central Time (9:00 a.m. Eastern Time). Interested parties may
participate by dialing (844) 841-1668. International parties
may dial (661) 378-9859. The confirmation code is
16558969. This call will also be webcast on VAALCO’s website
at www.vaalco.com.
An audio replay will be available beginning
approximately two hours after the end of the call and be available
through May 16, 2017 by dialing (855) 859-2056. International
parties may dial (404) 537-3406. The confirmation code is
16558969.
Forward Looking Statements
This document includes "forward-looking
statements" within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. All statements, other than statements of
historical facts, included in this document that address
activities, events, plans, expectations, objectives or developments
that VAALCO expects, believes or anticipates will or may occur in
the future are forward-looking statements. These statements
may include amounts due in connection with the Company’s withdrawal
from Angola, expected sources of future capital funding and future
liquidity, future operating losses, future changes in oil and
natural gas prices, future strategic alternatives, capital
expenditures, future drilling plans, prospect evaluations,
negotiations with governments and third parties including with the
government of the Republic of Gabon in connection with a revised
production sharing contract, expectations regarding processing
facilities, reserve growth, and other issues related to our exit
from Angola. These statements are based on assumptions made
by VAALCO based on its experience and perception of historical
trends, current conditions, expected future developments and other
factors it believes are appropriate in the circumstances.
Such statements are subject to a number of assumptions, risks and
uncertainties, many of which are beyond VAALCO's control.
These risks include, but are not limited to, oil and gas price
volatility, inflation, general economic conditions, the Company's
success in discovering, developing and producing reserves,
decisions by our current lender or future lenders, the risks
associated with liquidity, the risk that our negotiations with the
governments of the Republic of Gabon and the Republic of Angola
will be unsuccessful, lack of availability of goods, services and
capital, environmental risks, drilling risks, foreign regulatory
and operational risks, and regulatory changes. These and
other risks are further described in VAALCO's annual report on Form
10-K for the year ended December 31, 2016 and quarterly report on
Form 10-Q for the quarter ended March 31, 2017, which will be filed
shortly, and other reports filed with the SEC which can be reviewed
at http://www.sec.gov, or which can be received by contacting
VAALCO at 9800 Richmond Avenue, Suite 700, Houston, Texas 77042,
(713) 623-0801. Investors are cautioned that forward-looking
statements are not guarantees of future performance and that actual
results or developments may differ materially from those projected
in the forward-looking statements. VAALCO disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events,
or otherwise.
About VAALCO
VAALCO Energy, Inc. is a Houston, Texas based
independent energy company principally engaged in the acquisition,
exploration, development and production of crude oil. VAALCO’s
strategy is to increase reserves and production through the
development and exploitation of international oil and natural gas
properties. The Company's properties and exploration acreage are
located primarily in Gabon and Equatorial Guinea in West
Africa.
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VAALCO ENERGY, INC AND
SUBSIDIARIES |
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|
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|
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Condensed Consolidated
Balance Sheets (Unaudited) |
|
|
|
|
|
|
(in thousands, except
share and per share amounts) |
|
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|
|
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March 31, |
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December 31, |
|
|
2017 |
|
2016 |
ASSETS |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
24,245 |
|
|
$ |
20,474 |
|
Restricted cash |
|
|
755 |
|
|
|
741 |
|
Receivables: |
|
|
|
|
|
|
Trade |
|
|
6,496 |
|
|
|
6,751 |
|
Accounts
with partners, net of allowance |
|
|
3 |
|
|
|
3,297 |
|
Other,
net of allowance |
|
|
81 |
|
|
|
120 |
|
Crude oil
inventory |
|
|
1,037 |
|
|
|
913 |
|
Materials
and supplies |
|
|
102 |
|
|
|
84 |
|
Prepayments and other |
|
|
3,362 |
|
|
|
3,956 |
|
Current
assets - discontinued operations |
|
|
2,415 |
|
|
|
2,139 |
|
Total
current assets |
|
|
38,496 |
|
|
|
38,475 |
|
Property and equipment
- successful efforts method: |
|
|
|
|
|
|
Wells,
platforms and other production facilities |
|
|
389,302 |
|
|
|
389,231 |
|
Undeveloped acreage |
|
|
10,000 |
|
|
|
10,000 |
|
Equipment
and other |
|
|
10,003 |
|
|
|
9,779 |
|
|
|
|
409,305 |
|
|
|
409,010 |
|
Accumulated
depreciation, depletion and amortization |
|
|
(382,622 |
) |
|
|
(380,991 |
) |
Net
property and equipment |
|
|
26,683 |
|
|
|
28,019 |
|
Other noncurrent
assets: |
|
|
|
|
|
|
Restricted cash |
|
|
918 |
|
|
|
918 |
|
Value
added tax and other receivable, net of allowance |
|
|
5,390 |
|
|
|
5,110 |
|
Abandonment funding |
|
|
8,510 |
|
|
|
8,510 |
|
Total
assets |
|
$ |
79,997 |
|
|
$ |
81,032 |
|
LIABILITIES AND
SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
Accounts
payable |
|
$ |
9,745 |
|
|
$ |
19,096 |
|
Accrued
liabilities and other |
|
|
8,962 |
|
|
|
10,506 |
|
Current
portion of long-term debt |
|
|
8,333 |
|
|
|
7,500 |
|
Accounts
with partners |
|
|
4,805 |
|
|
|
- |
|
Current
liabilities - discontinued operations |
|
|
18,320 |
|
|
|
18,452 |
|
Total
current liabilities |
|
|
50,165 |
|
|
|
55,554 |
|
Asset retirement
obligations |
|
|
18,851 |
|
|
|
18,612 |
|
Other long term
liabilities |
|
|
284 |
|
|
|
284 |
|
Long-term debt,
excluding current portion |
|
|
6,621 |
|
|
|
6,940 |
|
Total
liabilities |
|
|
75,921 |
|
|
|
81,390 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Shareholders’ equity
(deficit): |
|
|
|
|
|
|
Preferred
stock, none issued, 500,000 shares authorized, $25 par value |
|
|
- |
|
|
|
- |
|
Common
stock, 66,146,890 and 66,109,565 shares issued, $0.10 par
value, 100,000,000 shares authorized |
|
|
6,614 |
|
|
|
6,611 |
|
Additional paid-in capital |
|
|
70,440 |
|
|
|
70,268 |
|
Less
treasury stock, 7,555,095 shares at cost |
|
|
(37,933 |
) |
|
|
(37,933 |
) |
Retained
deficit |
|
|
(35,045 |
) |
|
|
(39,304 |
) |
Total
shareholders' equity (deficit) |
|
|
4,076 |
|
|
|
(358 |
) |
Total
liabilities and shareholders' equity (deficit) |
|
$ |
79,997 |
|
|
$ |
81,032 |
|
VAALCO ENERGY, INC AND
SUBSIDIARIES |
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|
|
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|
|
|
|
Consolidated Statements
of Operations |
|
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|
|
|
|
|
|
|
(Unaudited) |
|
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|
|
|
|
|
|
|
(in thousands, except
per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, 2017 |
|
March 31, 2016 |
|
December 31, 2016 |
Revenues: |
|
|
|
|
|
|
|
|
|
Oil and
gas sales |
|
$ |
21,266 |
|
|
$ |
10,976 |
|
|
$ |
15,326 |
|
Operating costs and
expenses: |
|
|
|
|
|
|
|
|
|
Production expense |
|
|
7,946 |
|
|
|
11,253 |
|
|
|
11,830 |
|
Exploration expense |
|
|
- |
|
|
|
- |
|
|
|
1 |
|
Depreciation, depletion and amortization |
|
|
1,869 |
|
|
|
2,238 |
|
|
|
1,139 |
|
General
and administrative expense |
|
|
3,127 |
|
|
|
2,247 |
|
|
|
1,722 |
|
Other
operating expense |
|
|
- |
|
|
|
8,881 |
|
|
|
(1,106 |
) |
General
and administrative related to shareholder matters |
|
|
15 |
|
|
|
(453 |
) |
|
|
18 |
|
Bad debt
expense (recovery) and other |
|
|
98 |
|
|
|
343 |
|
|
|
645 |
|
Total
operating costs and expenses |
|
|
13,055 |
|
|
|
24,509 |
|
|
|
14,249 |
|
Other
operating income (loss), net |
|
|
(63 |
) |
|
|
18 |
|
|
|
(258 |
) |
Operating income
(loss) |
|
|
8,148 |
|
|
|
(13,515 |
) |
|
|
819 |
|
Other
income (expense): |
|
|
|
|
|
|
|
|
|
Interest
income (expense), net |
|
|
(403 |
) |
|
|
(488 |
) |
|
|
(328 |
) |
Other,
net |
|
|
(116 |
) |
|
|
258 |
|
|
|
(1,482 |
) |
Total
other income (expense) |
|
|
(519 |
) |
|
|
(230 |
) |
|
|
(1,810 |
) |
Income (loss) from
continuing operations before income taxes |
|
|
7,629 |
|
|
|
(13,745 |
) |
|
|
(991 |
) |
Income tax expense |
|
|
3,194 |
|
|
|
1,685 |
|
|
|
2,364 |
|
Income (loss) from
continuing operations |
|
|
4,435 |
|
|
|
(15,430 |
) |
|
|
(3,355 |
) |
Income (loss) from
discontinued operations, net of tax |
|
|
(176 |
) |
|
|
7,806 |
|
|
|
(286 |
) |
Net income (loss) |
|
$ |
4,259 |
|
|
$ |
(7,624 |
) |
|
$ |
(3,641 |
) |
|
|
|
|
|
|
|
|
|
|
Basic net income (loss)
per share |
|
|
|
|
|
|
|
|
|
Income
(loss) from continuing operations |
|
$ |
0.07 |
|
|
$ |
(0.26 |
) |
|
$ |
(0.06 |
) |
Income
(loss) from discontinued operations |
|
|
(0.00 |
) |
|
|
0.13 |
|
|
|
(0.00 |
) |
Net
income (loss) |
|
$ |
0.07 |
|
|
$ |
(0.13 |
) |
|
$ |
(0.06 |
) |
Basic
weighted average shares outstanding |
|
|
58,567 |
|
|
|
58,513 |
|
|
|
58,554 |
|
Diluted net income
(loss) per share |
|
|
|
|
|
|
|
|
|
Income
(loss) from continuing operations |
|
$ |
0.07 |
|
|
$ |
(0.26 |
) |
|
$ |
(0.06 |
) |
Income
(loss) from discontinued operations |
|
|
(0.00 |
) |
|
|
0.13 |
|
|
|
(0.00 |
) |
Net
income (loss) |
|
$ |
0.07 |
|
|
$ |
(0.13 |
) |
|
$ |
(0.06 |
) |
Basic
weighted average shares outstanding |
|
|
58,580 |
|
|
|
58,513 |
|
|
|
58,554 |
|
VAALCO ENERGY, INC AND
SUBSIDIARIES |
|
|
|
|
|
|
Consolidated Statements
of Cash Flows |
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, 2017 |
|
March 31, 2016 |
CASH FLOWS FROM
OPERATING ACTIVITIES: |
|
|
|
|
|
|
Net income (loss) |
|
$ |
4,259 |
|
|
$ |
(7,624 |
) |
Adjustments to
reconcile net income (loss) to net cash |
|
|
|
|
|
|
Loss
(income) from discontinued operations |
|
|
176 |
|
|
|
(7,806 |
) |
Depreciation, depletion and amortization |
|
|
1,869 |
|
|
|
2,238 |
|
Other
amortization |
|
|
97 |
|
|
|
103 |
|
Unrealized foreign exchange loss |
|
|
(128 |
) |
|
|
(728 |
) |
Stock-based compensation |
|
|
154 |
|
|
|
420 |
|
Commodity
derivatives loss |
|
|
180 |
|
|
|
- |
|
Bad debt
provision |
|
|
98 |
|
|
|
343 |
|
Other
operating (income) loss, net |
|
|
63 |
|
|
|
(18 |
) |
Change in
operating assets and liabilities: |
|
|
|
|
|
|
Trade
receivables |
|
|
255 |
|
|
|
(70 |
) |
Accounts
with partners |
|
|
8,099 |
|
|
|
(2,742 |
) |
Other
receivables |
|
|
40 |
|
|
|
(91 |
) |
Crude oil
inventory |
|
|
(124 |
) |
|
|
(281 |
) |
Materials
and supplies |
|
|
(18 |
) |
|
|
20 |
|
Value
added tax and other receivable |
|
|
(317 |
) |
|
|
(690 |
) |
Prepayments and other |
|
|
554 |
|
|
|
(337 |
) |
Accounts
payable |
|
|
(9,066 |
) |
|
|
(2,641 |
) |
Accrued
liabilities and other |
|
|
(1,509 |
) |
|
|
1,769 |
|
Net cash
provided by (used in) continuing operating activities |
|
|
4,682 |
|
|
|
(18,135 |
) |
Net cash
provided by (used in) discontinued operating activities |
|
|
(584 |
) |
|
|
17,955 |
|
Net cash
provided by (used in) operating activities |
|
|
4,098 |
|
|
|
(180 |
) |
CASH FLOWS
FROM INVESTING ACTIVITIES: |
|
|
|
|
(Increase) decrease in restricted cash |
|
|
(14 |
) |
|
|
252 |
|
Property
and equipment expenditures |
|
|
(768 |
) |
|
|
(1,483 |
) |
Net cash
used in continuing investing activities |
|
|
(782 |
) |
|
|
(1,231 |
) |
Net cash
provided by discontinued investing activities |
|
|
- |
|
|
|
210 |
|
Net cash
used in investing activities |
|
|
(782 |
) |
|
|
(1,021 |
) |
CASH FLOWS
FROM FINANCING ACTIVITIES: |
|
|
|
|
Proceeds
from the issuances of common stock |
|
|
38 |
|
|
|
- |
|
Borrowings |
|
|
4,167 |
|
|
|
- |
|
Debt
repayment |
|
|
(3,750 |
) |
|
|
- |
|
Net cash provided by
continuing financing activities |
|
|
455 |
|
|
|
- |
|
Net cash provided by
discontinued financing activities |
|
|
- |
|
|
|
- |
|
Net cash provided by
financing activities |
|
|
455 |
|
|
|
- |
|
NET CHANGE IN CASH AND
CASH EQUIVALENTS |
|
|
3,771 |
|
|
|
(1,201 |
) |
CASH AND CASH
EQUIVALENTS -- |
|
|
|
|
|
|
BEGINNING
OF PERIOD |
|
|
20,474 |
|
|
|
25,357 |
|
END OF
PERIOD |
|
$ |
24,245 |
|
|
$ |
24,156 |
|
VAALCO ENERGY, INC AND
SUBSIDIARIES |
|
|
|
|
|
|
|
|
|
Selected Financial and
Operating Statistics |
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, 2017 |
|
March 31, 2016 |
|
December 31, 2016 |
NET SALES DATA: |
|
|
|
|
|
|
|
|
|
Oil
(MBbls) |
|
|
394 |
|
|
381 |
|
|
326 |
|
Natural
Gas (MMcf) |
|
|
- |
|
|
32 |
|
|
25 |
|
Oil
equivalents (MBOE) |
|
|
394 |
|
|
386 |
|
|
330 |
|
Average
daily sales volumes (BOE/day) |
|
|
4,378 |
|
|
4,242 |
|
|
3,587 |
|
NET PRODUCTION
DATA |
|
|
|
|
|
|
|
|
|
Oil
(MBbls) |
|
|
416 |
|
|
405 |
|
|
335 |
|
Natural
Gas (MMcf) |
|
|
- |
|
|
32 |
|
|
25 |
|
Oil
equivalents (MBOE) |
|
|
416 |
|
|
411 |
|
|
339 |
|
Average daily production volumes (BOE/day) |
4,622 |
|
|
4,516 |
|
|
3,682 |
|
AVERAGE SALES
PRICES: |
|
|
|
|
|
|
|
|
|
Oil
($/Bbl) |
|
$ |
51.99 |
|
$ |
27.07 |
|
$ |
41.88 |
|
Natural
Gas ($/Mcf) |
|
|
0.00 |
|
|
1.57 |
|
|
2.35 |
|
Weighted
average price ($/BOE) |
|
|
51.99 |
|
|
27.05 |
|
|
41.76 |
|
COSTS AND EXPENSES (PER
BOE OF SALES): |
|
|
|
|
|
|
|
|
|
Production expense |
|
$ |
20.17 |
|
$ |
29.15 |
|
$ |
35.85 |
|
Production expense, excluding workovers* |
|
|
20.44 |
|
|
18.03 |
|
|
25.60 |
|
Depreciation, depletion and amortization |
|
|
4.74 |
|
|
5.81 |
|
|
3.45 |
|
General
and administrative expense** |
|
|
7.94 |
|
|
5.82 |
|
|
5.22 |
|
Property and equipment
expenditures, cash basis |
|
$ |
768 |
|
$ |
1,483 |
|
$ |
(1,764 |
) |
|
|
|
|
|
|
|
|
|
|
|
*Workover
costs excluded from the three months ended March 31, 2017, March
31, 2016 and December 31, 2016 are ($0.1) million, $4.3 million and
$3.4 million. |
**General
and administrative expenses include $0.39, $1.09 and $0.22 per BOE
of non-cash stock-based compensation expense in the three months
ended March 31, 2017, March 31, 2016 and December 31, 2016. |
|
NON-GAAP FINANCIAL MEASURES
Adjusted EBITDAX is a supplemental non-GAAP
financial measure used by VAALCO’s management and by external users
of the Company’s financial statements, such as industry analysts,
lenders, rating agencies, investors and others who follow the
industry as an indicator of the Company’s ability to internally
fund exploration and development activities and to service or incur
additional debt. Adjusted EBITDAX is a non-GAAP financial measure
and as used herein represents net income before discontinued
operations, interest income (expense) net, income tax expense,
depletion, depreciation and amortization, impairment of proved
properties, exploration expense, non-cash and other items including
stock compensation expense and commodity derivative loss.
Adjusted EBITDAX has significant limitations,
including that it does not reflect the Company’s cash requirements
for capital expenditures, contractual commitments, working capital
or debt service. Adjusted EBITDAX should not be considered as a
substitute for net income (loss), operating income (loss), cash
flows from operating activities or any other measure of financial
performance or liquidity presented in accordance with GAAP.
Adjusted EBITDAX excludes some, but not all, items that affect net
income (loss) and operating income (loss) and these measures may
vary among other companies. Therefore, the Company’s Adjusted
EBITDAX may not be comparable to similarly titled measures used by
other companies.
The table below reconciles the most directly
comparable GAAP financial measures to Adjusted EBITDAX.
|
VAALCO
ENERGY, INC AND SUBSIDIARIES |
Reconciliations of Non-GAAP Measures |
(Unaudited) |
(in
thousands) |
|
|
|
|
|
|
|
|
|
|
Reconciliation
of Net income (loss) to Adjusted EBITDAX |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, 2017 |
|
March 31, 2016 |
|
December 31, 2016 |
Net income (loss) |
|
$ |
4,259 |
|
$ |
(7,624 |
) |
|
|
(3,641 |
) |
Add back: |
|
|
|
|
|
|
|
|
|
Impact of
discontinued operations |
|
|
176 |
|
|
(7,806 |
) |
|
|
286 |
|
Interest
(income) expense, net |
|
|
403 |
|
|
488 |
|
|
|
328 |
|
Income
tax expense |
|
|
3,194 |
|
|
1,685 |
|
|
|
2,364 |
|
Depreciation, depletion and amortization |
|
|
1,869 |
|
|
2,238 |
|
|
|
1,139 |
|
Exploration expense |
|
|
- |
|
|
- |
|
|
|
1 |
|
Non-cash or unusual
items: |
|
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
154 |
|
|
420 |
|
|
|
72 |
|
Shareholder matters |
|
|
15 |
|
|
(453 |
) |
|
|
18 |
|
Commodity
derivative loss |
|
|
180 |
|
|
- |
|
|
|
939 |
|
Equipment
write-offs |
|
|
63 |
|
|
- |
|
|
|
- |
|
Bad debt
expense |
|
|
98 |
|
|
343 |
|
|
|
645 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDAX |
|
$ |
10,411 |
|
$ |
(10,709 |
) |
|
$ |
2,151 |
|
Investor Contact
Phil Patman 713-623-0801
Vaalco Energy (NYSE:EGY)
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