CALGARY, Aug. 6 /CNW/ - Crescent Point Energy Corp., ("Crescent Point" or
the "Company") (TSX: CPG), is pleased to announce its operating and financial
results for the second quarter ended June 30, 2009. The unaudited financial
statements and notes as well as management's discussion and analysis
pertaining to the period are available on Crescent Point's website at
www.crescentpointenergy.com and on SEDAR at www.sedar.com.
FINANCIAL AND OPERATING HIGHLIGHTS
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Three months ended Six months ended
($000s except trust June 30 June 30
units, per trust -----------------------------------------------------
unit and per % %
boe amounts) 2009 2008 Change 2009 2008 Change
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Financial
Funds flow from
operations(1) 137,960 142,990 (4) 326,188 298,654 9
Per unit(1)(2) 0.91 1.13 (19) 2.25 2.41 (7)
Net income
(loss)(3) (67,262) (353,660) (81) (72,408) (395,124) (82)
Per unit(2)(3) (0.45) (2.83) (84) (0.51) (3.21) (84)
Cash distributions 104,014 78,635 32 202,004 152,260 33
Per unit 0.69 0.63 10 1.38 1.23 12
Payout ratio (%)(1) 75 55 20 62 51 11
Per unit (%)(1)(2) 76 56 20 61 51 10
Net debt(1)(4) 681,419 635,731 7 681,419 635,731 7
Capital
acquisitions
(net)(5) 327,416 1,710 19,047 464,380 132,648 250
Development
capital
expenditures 50,161 124,487 (60) 116,437 241,382 (52)
Weighted average
trust units
outstanding (mm)
Basic 149.2 124.8 20 142.8 122.9 16
Diluted 151.6 126.4 20 145.2 124.5 17
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Operating
Average daily
production
Crude oil and
NGLs (bbls/d) 36,645 31,686 16 35,999 31,398 15
Natural gas
(mcf/d) 28,037 29,144 (4) 27,072 28,735 (6)
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Total (boe/d) 41,318 36,543 13 40,511 36,188 12
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Average selling
prices(6)
Crude oil and
NGLs ($/bbl) 64.98 115.48 (44) 56.50 103.07 (45)
Natural gas
($/mcf) 3.58 10.45 (66) 4.34 9.11 (52)
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Total ($/boe) 60.06 108.46 (45) 53.11 96.67 (45)
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Netback ($/boe)
Oil and gas sales 60.06 108.46 (45) 53.11 96.67 (45)
Royalties (10.31) (20.06) (49) (8.83) (17.31) (49)
Operating expenses (8.80) (8.78) - (8.48) (8.59) (1)
Transportation (1.45) (1.97) (26) (1.55) (2.11) (27)
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Netback prior to
realized
derivatives 39.50 77.65 (49) 34.25 68.66 (50)
Realized gain (loss)
on derivatives(7) 3.71 (16.61) 122 6.60 (11.76) 156
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Operating
netback(1) 43.21 61.04 (29) 40.85 56.90 (28)
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The Crescent Point financial and operating results do not reflect the
production or cash flows of Shelter Bay Energy Inc. ("Shelter Bay") other
than the production and cash flows associated with Crescent Point's
interests in the wells farmed out to Shelter Bay by Crescent Point.
Crescent Point accounts for its investment in Shelter Bay using the
equity method of accounting. Accordingly, Crescent Point records its
share of Shelter Bay net income or loss in the "equity and other income"
caption on the consolidated statements of operations, comprehensive
income and deficit.
(1) Funds flow from operations, payout ratio, net debt and operating
netback as presented do not have any standardized meaning prescribed
by Canadian generally accepted accounting principles and, therefore,
may not be comparable with the calculation of similar measures
presented by other entities.
(2) The per unit amounts (with the exception of per unit distributions)
are the per unit - diluted amounts.
(3) The net loss of $72.4 million for the six months ended June 30, 2009
includes unrealized derivative losses of $238.6 million, a
$72.5 million realized derivative gain on crystallization of various
oil contracts and a $11.4 million bad debt provision for SemCanada
Crude Company. The net loss of $395.1 million for the six months
ended June 30, 2008 includes unrealized loss on derivatives of
$540.6 million and a $34.5 million realized derivative loss on
crystallization of various oil contracts.
(4) Net debt includes bank indebtedness, working capital and long term
investments, but excludes risk management liabilities and assets.
(5) Capital acquisitions represent total consideration for the
transactions including bank debt and working capital assumed.
(6) The average selling prices reported are before realized derivatives
and transportation charges.
(7) The realized derivative gain for the three month and six month period
ended June 30, 2009 excludes realized derivative gains on
crystallization of $3.5 million and $72.5 million, respectively. The
2008 realized derivative loss excludes a $34.5 million loss on
derivative crystallization of various oil contracts.
HIGHLIGHTS
In the second quarter of 2009, Crescent Point continued to execute its
integrated business strategy of acquiring, exploiting and developing high
quality, long life light and medium oil and natural gas properties.
- Crescent Point exceeded production guidance and produced an average
of 41,318 boe/d in the second quarter of 2009, which includes only
one month of production from assets acquired in the agreement with
Talisman Energy Canada ("Talisman"). This represents a 4 percent
increase over the first quarter of 2009 and a 13 percent increase
over the second quarter of 2008.
- The Company spent $50.2 million on development capital activities in
the second quarter, including $18.0 million on facilities, land and
seismic and $32.2 million on drilling and completions activities.
- During the quarter, Crescent Point drilled 16 (14.6 net) wells with a
100 percent success rate, including 14 (12.9 net) Bakken horizontal
wells. The Company also fracture stimulated 23 (22.8 net) Bakken
horizontal wells.
- On May 7, 2009, the Company announced that it had entered into two
separate arrangement agreements with Wild River Resources Ltd. ("Wild
River") and Gibraltar Exploration Ltd. ("Gibraltar"), each a
private oil and gas company active in southwest Saskatchewan. Under
the terms of the agreements and including the sale of 25 percent of
the acquired assets to Shelter Bay Energy Inc. ("Shelter Bay"),
Crescent Point would acquire 2,900 boe/d of high quality, long life
production, 110 net sections of undeveloped land, and 12.3 million
boe of proved plus probable reserves. The related transactions
subsequently closed in early July 2009.
- On June 1, 2009, the Company closed the previously announced
agreement with affiliates of Talisman and TriStar Oil & Gas Ltd.
("TriStar") wherein Crescent Point and TriStar jointly acquired all
of Talisman's assets in southeast Saskatchewan and Montana. On a net
basis, after selling a portion of the assets acquired to Shelter Bay,
Crescent Point acquired approximately 4,000 boe/d of high quality
southeast Saskatchewan production, of which 700 boe/d is in the
Bakken resource play.
- On July 2, 2009, Crescent Point announced that it had completed its
previously announced strategic conversion (the "Conversion") to a
dividend paying corporation. Unitholders voted 99.9 percent in favour
of the Conversion at a unitholder meeting on June 29, 2009. The
initial dividend for the Company was set at $0.23 per share for the
month of July, which equals the monthly distribution paid by Crescent
Point Energy Trust prior to the Conversion.
- It is Crescent Point's understanding that dividends paid by the
Company in respect of shares held by Canadians outside of a
Registered Retirement Savings Plan ("RRSP"), Registered Retirement
Income Fund ("RRIF"), or Deferred Profit Sharing Plan ("DPSP") will
be eligible for the Canadian Dividend Tax Credit. As such, with the
monthly dividend of $0.23 per share, Canadians holding shares outside
of a RRSP, RRIF or DPSP will receive an increase on an after tax
basis when they receive the $0.23 monthly dividend instead of
Crescent Point Energy Trust's most recent distribution.
- During the second quarter, the Company's bank line was increased to
$1.2 billion from $1.15 billion, reflecting the Company's strong
reserves growth from development activities and strategic
acquisitions.
- Crescent Point's balance sheet remains strong, with more than
$300 million of unutilized capacity in its bank line and a projected
net debt to 12 month cash flow of 1.0 times.
- Crescent Point's funds flow from operations in the second quarter of
2009 decreased by 4 percent to $138.0 million ($0.91 per unit -
diluted), compared to $143.0 million ($1.13 per unit - diluted) in
the second quarter of 2008. Funds flow from operations included the
successful crystallization of $3.5 million of mark to market hedging
gains in its forward commodity price risk management program
("derivative crystallization") and a $11.4 million provision in
respect of the remainder of its previously announced exposure to
SemCanada Crude Company ("SemCanada"). Excluding the derivative
crystallization and the SemCanada provision, Crescent Point's funds
flow from operations was $145.9 million ($0.96 per unit - diluted).
- Crescent Point maintained consistent monthly distributions of $0.23
per unit, totaling $0.69 per unit for the second quarter of 2009.
This is up from $0.63 per unit paid in the second quarter of 2008 and
resulted in a payout ratio of 76 percent on a per unit - diluted
basis, up from 55 percent in the second quarter of 2008. Excluding
the derivative crystallization and SemCanada provision, Crescent
Point's payout ratio was 72 percent on a per unit - diluted basis.
- Crescent Point continued its disciplined hedging strategy to provide
increased certainty over cash flow and dividends.
