14 May 2012 13:00
Bankers Petroleum Announces 2012 First Quarter Financial and Operational Results
Record Quarter of Revenue, Netback and Cash Flow
CALGARY, May 14, 2012 /CNW/ - Bankers Petroleum Ltd. ("Bankers" or the "Company") is pleased to provide its 2012 first quarter financial and operational results. During the quarter, Bankers achieved several key milestones, including record revenue, netback and cash flow.
The complete reporting package, consisting of Management's Discussion and Analysis along with Financial Statements and Notes, is posted on the Company's website www.bankerspetroleum.com and SEDAR: www.sedar.com.
Results at a Glance Three months ended (US$000, except as noted) March 31 2012 2011 Change Oil revenue 102,668 72,736 41% Net operating income 53,471 39,834 34% Net income 7,765 11,219 (31%) Per share - basic ($) 0.031 0.046 (33%)
Funds generated from operations 48,072 29,948 61%
Per share - basic ($) 0.192 0.122 57% Capital expenditures 62,701 51,930 21% Average sales (bopd) 13,279 11,894 12% Average price ($/barrel) 84.96 67.95 25% Netback ($/barrel) 44.24 37.22 19% March 31 December 31 March 31 2012 2011 2011 Cash and deposits 77,150 54,013 82,854 Working capital 118,989 80,282 92,817 Total assets 747,029 661,216 522,476 Long-term debt 92,009 46,692 1,851 Shareholders' equity 441,101 412,679 371,355
Highlights for the quarter ended March 31, 2012 are:
· Oil sales averaged 13,279 bopd, an increase of 12% compared to 11,894 bopd for the same period in 2011, and 13,399 bopd during the previous quarter.
· Revenue increased by 16% to $102.7 million ($84.96/bbl) from $88.3 million ($71.67/bbl) in the previous quarter and by 41% from $72.7 million ($67.95/bbl) in the first quarter of 2011. Revenue represented 72% of the Brent oil price of $119 per barrel.
· Royalties in favor of the Albanian Government and related entities, totalled $19.1 million for the quarter, up from $13.8 million for the first quarter of 2011. Total royalties for 2011 were $64 million, representing 19% of revenue.
· Operating, sales and transportation costs were $30 million in the first quarter, which include Albanian based companies and their employees. This compares with $19 million for the first quarter of 2011 and $106 million for 2011.
· The Company recorded net operating income (netback) of $53.5 million ($44.24/bbl) in the first quarter of 2012, compared to $37.7 million ($30.56/ bbl) during the previous quarter and $39.8 million ($37.22/bbl) in the same period of 2011.
· In the first quarter of 2012, funds generated from operations were $48.1 million, an increase of 47% from the preceding quarter of $32.7 million and an increase of 61% from $29.9 million in the first quarter of 2011.
· Capital expenditures were $62.7 million in the first quarter of 2012.The Company drilled 27 wells during the quarter, of which 24 were horizontalproduction wells and 3 were water disposal wells. Reactivation and recompletionwork continued with 7 new reactivations and recompletions. During the sameperiod of 2011, capital expenditures were $51.9 million.
· Equity proceeds from warrant and option exercises during the period raised $12.1 million.
· The Company continues to maintain a strong financial position at March 31, 2012 with cash of $77.2 million and working capital of $119.0 million. Working capital for December 31, 2011 and March 31, 2011 was $80.3 million and $92.8 million, respectively.
Operational Update and Outlook
Average second quarter production to date is 13,600 bopd. Flat production overthe last few months is primarily due to operational challenges associated withmature heavy oilfield development including interference from old well bores,sand production, and water disposal capacity, all of which are impacting newwell performance and the overall production growth rate. The Company isundertaking several technical and operational initiatives to enhance well andfield performance as it continues to implement the necessary actions requiredto mitigate or lessen these operational challenges.
Over the next few months, the Company will focus its development drilling campaign in high impact areas of the Patos-Marinza oilfield along with reviewing secondary pressure support programs in the Gorani and Driza formations. Steam injection at the thermal pilot will resume shortly and a new drilling location is being finalized for the exploration of Block F.
The Company will be releasing an operational update on the morning of June 4,2012, followed immediately by a Company hosted Capital Markets day in Calgaryto present a detailed description of its development activities for theremainder of this year. Further details on time and venue will be announcedcloser to the event.
Bankers' Annual General Meeting will be held at The Metropolitan Centre, 333 - 4 Avenue SW, Calgary, Alberta, on June 27, 2012 at 3:00 p.m. (Calgary time).
For additional information, please see an updated version of the Company's May corporate presentation on www.bankerspetroleum.com.
BANKERS PETROLEUM LTD. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE THREE MONTHS ENDED MARCH 31 (Unaudited, expressed in thousands of US dollars, except per share amounts) 2012 2011 Revenues $ 102,668 $ 72,736 Royalties (19,154) (13,755) 83,514 58,981
Unrealized loss on financial commodity contracts (3,209) (1,401)
80,305 57,580 Operating expenses 17,432 11,597
Sales and transportation expenses 12,611 7,550 General and administrative expenses 4,110 2,858
Depletion and depreciation 13,677 8,265 Share-based payments 4,236 4,645 52,066 34,915 28,239 22,665 Net finance expense 2,857 1,941 Income before income tax 25,382 20,724 Deferred income tax expense (17,617) (9,505) Net income for the period 7,765 11,219 Other comprehensive income Currency translation adjustment 506 1,814 Comprehensive income for the period $ 8,271 $ 13,033
Basic earnings per share $ 0.031 $ 0.046 Diluted earnings per share $ 0.031 $ 0.044 BANKERS PETROLEUM LTD. CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited, expressed in thousands of US dollars) ASSETS March 31 December 31 2012 2011 Current assets Cash and cash equivalents $ 72,150 $ 49,013 Restricted cash 5,000 5,000 Accounts receivable 72,397 56,006 Inventory 18,527 14,412
Deposits and prepaid expenses 9,722 17,463 Financial commodity contracts 475 3,684 178,271 145,578 Non-current assets Property, plant and equipment 568,758 515,638 $ 747,029 $ 661,216 LIABILITIES Current liabilities
Accounts payable and accrued liabilities $ 58,393 $ 52,109 Current portion of long-term debt 889 13,187 59,282 65,296 Non-current liabilities Long-term debt 92,009 46,692 Decommissioning obligation 14,032 13,561 Deferred tax liabilities 140,605 122,988 305,928 248,537 SHAREHOLDERS' EQUITY Share capital 332,398 318,021 Warrants - 1,540 Contributed surplus 56,965 49,651 Currency translation reserve 6,915 6,409 Retained earnings 44,823 37,058 441,101 412,679 $ 747,029 $ 661,216 BANKERS PETROLEUM LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31 (Unaudited, expressed in thousands of US dollars) 2012 2011 Cash provided by (used in): Operating activities Net income for the period $ 7,765 $ 11,219 Depletion and depreciation 13,677 8,265 Amortization of deferred financing costs - 734 Accretion of long-term debt 1,127 - Accretion of decommissioning obligation 195 95 Unrealized foreign exchange loss 246 672 Deferred income tax expense 17,617 9,505 Share-based payments 4,236 4,645 Unrealized loss on financial commodity contracts 3,209 1,401 Cash premiums paid for financial commodity contracts - (6,588) 48,072 29,948 Change in non-cash working capital (5,839) (7,701) 42,233 22,247 Investing activities Additions to property, plant and equipment (62,701)
(51,930)
Change in non-cash working capital (642) 5,988 (63,343) (45,942) Financing activities Issue of shares for cash 12,146 3,130 Financing costs (750) (26) Increase (decrease) in long-term debt 32,824 (5,413) 44,220 (2,309)
Foreign exchange gain on cash and cash equivalents 27 739
Increase (decrease) in cash and cash equivalents 23,137 (25,265)
Cash and cash equivalents, beginning of period 49,013 106,619 Cash and cash equivalents, end of period $ 72,150 $ 81,354
Interest paid $ 201 $ 310 Interest received $ 60 $ 138 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 December 31, 2010 244,794,990 $ 309,379 $ 1,597 $ 28,135 $ 6,094 $ 1,062 $ 346,267 Share-based payments - - - 8,925 - - 8,925 Options exercised 1,963,444 5,077 - (1,947) - - 3,130
Net income for the period - - - -
- 11,219 11,219 Currency translation - - - - 1,814 - 1,814 adjustment Balance at March 31, 2011 246,758,434 $ 314,456 $ 1,597 $ 35,113 $ 7,908 $ 12,281 $ 371,355 Share-based payments - - - 15,560 - - 15,560 Options exercised 765,002 3,271 - (1,022) - - 2,249 Warrants exercised 174,333 461 (57) - - - 404 Share issue costs - (167) - - - - (167)
Net income for the period - - - - - 24,777 24,777 Currency translation - - - - (1,499) - (1,499)adjustment Balance at December 31, 2011 247,697,769 $ 318,021 $ 1,540 $ 49,651 $ 6,409 $ 37,058 $ 412,679 Share-based payments - - - 8,005 - - 8,005 Options exercised 530,612 1,781 - (698) - - 1,083 Warrants exercised 4,672,991 12,596 (1,533) - - - 11,063 Warrants expired - - (7) 7 - - - Net income for the period - - - - - 7,765 7,765 Currency translation - - - - 506 - 506 adjustment Balance at March 31, 2012 252,901,372 $ 332,398 $ - $ 56,965 $ 6,915 $ 44,823 $ 441,101
Caution Regarding Forward-looking Information
Information in this news release respecting matters such as the expected futureproduction levels from wells, future prices and netback, work plans,anticipated total oil recovery of the Patos-Marinza and Ku§ova oilfieldsconstitute forward-looking information. Statements containing forward-lookinginformation express, as at the date of this news release, the Company's plans,estimates, forecasts, projections, expectations, or beliefs as to future eventsor results and are believed to be reasonable based on information currentlyavailable to the Company. Exploration for oil is a speculative business that involves a high degree ofrisk. The Company's expectations for its Albanian operations and plans aresubject to a number of risks in addition to those inherent in oil productionoperations, including: that Brent oil prices could fall resulting in reducedreturns and a change in the economics of the project; availability offinancing; delays associated with equipment procurement, equipment failure andthe lack of suitably qualified personnel; the inherent uncertainty in theestimation of reserves; exports from Albania being disrupted due to unplanneddisruptions; and changes in the political or economic environment.Production and netback forecasts are based on a number of assumptions includingthat the rate and cost of well reactivations and well recompletions of the pastwill continue and success rates and production rates will be similar to thoserates experienced for previous well recompletions and reactivations; continuedavailability of the necessary equipment, personnel and financial resources tosustain the Company's planned work program; continued political and economicstability in Albania; the existence of reserves as expected; the continuedrelease by Albpetrol of areas and wells pursuant to the Plan of Development andAddendum; the absence of unplanned disruptions; the ability of the Company tosuccessfully drill new wells and bring production to market; and general risksinherent 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 Ku§ova 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.
For further information:Abby BadwiPresident and Chief Executive Officer(403) 513-2694Doug UrchExecutive VP, Finance and Chief Financial Officer(403) 513-2691Mark HodgsonVP, Business Development(403) 513-2695Email: investorrelations@bankerspetroleum.comWebsite: www.bankerspetroleum.comAIM NOMAD:Canaccord Genuity LimitedHenry Fitzgerald-O'Connor+44 20 7050 6500AIM JOINT BROKERS:Canaccord Genuity LimitedRyan Gaffney/ Henry Fitzgerald-O'Connor+44 20 7050 6500Macquarie Capital AdvisorsPaul Connolly +44 20 3037 5639(BNK. BNK)
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