Colombia
Press Release

Parex Q1 2020 Results: US$97mm Cash Flow, US$397mm Cash Balance and Debt Free

Bnamericas Published: Thursday, May 14, 2020

Parex Resources release

CALGARY, Alberta, May  13, 2020  (GLOBE NEWSWIRE) -- Parex Resources Inc. (“Parex” or the “Company”) (TSX:PXT), a company focused on Colombian oil exploration and production, announces its unaudited financial and operating results for the three months ended March 31, 2020 (“First Quarter” or “Q1”). All amounts herein are in United States Dollars (“USD”) unless otherwise stated.

Please note Parex will hold its Annual General and Special Meeting of Shareholders (“AGM”) virtually on Thursday, May 14, 2020 beginning at 9:30 am (Calgary Time). Following the conclusion of the AGM, the Company will proceed immediately to a Q&A session to discuss the First Quarter results.

Parex continues to work with the community during the COVID-19 pandemic to support safety and wellness.  The Company is supporting local communities in Calgary and Colombia by sponsoring food deliveries, contributing to local food banks and supplying personal protective equipment.  Along with enhancing the safety protocol in its operating fields, Parex continues to look for ways to further support its communities during this challenging time.

2020 First Quarter Highlights: Best-in-Class Balance Sheet

  • Quarterly average production was 54,295 barrels of oil equivalent per day ("boe/d") (consisting of 53,037 barrels per day ("bbls/d")  of crude oil and 7,548 thousand cubic feet per day ("mcf/d') of conventional natural gas) (98% crude oil),  an increase of 15% on a per basic share basis over the prior year comparative period;
  • Recognized a net loss of $3.8 million ($0.03 per share basic) compared to net income of $87.2 million ($0.61 per share basic) in the previous quarter ended December 31, 2019 and net income of $82.0 million ($0.54 basic per share) in the comparative quarter of 2019. The net loss is primarily a result of a $84.7 million reduction in deferred tax assets as a result of a 24% decrease in the Colombian Peso/USD exchange rate in Q1 2020;
  • Generated an operating netback of $24.41 per barrel of oil equivalent ("boe") and funds flow provided by operations ("FFO") netback of $20.63 per boe from an average Brent price of $51.05 per barrel ("bbl");
  • FFO of $97.3 million ($0.69 (or CAD $0.93)(1) per share basic) as compared to $133.5 million ($0.88 (or CAD $1.17)(1) per share basic) for the prior year comparative period.  FFO was reduced due to a higher percentage of March sales at lower Brent prices and an inventory build;
  • Utilized free cash flow of $26.0 million to purchase 3,865,000 of the Company's common shares for a total cost of $51.0 million (average price of CAD$18.53/share) pursuant to the Company's normal course issuer bid program ("NCIB");
  • Capital expenditures ("Capex") were $71.3 million in the period. Capex was fully funded from FFO;
  • Working capital was $330.4 million (CAD $3.35 per share basic)(2) at March 31, 2020 compared to $344.0 million at December 31, 2019 and $207.4 million at March 31, 2019. The Company has an undrawn syndicated bank credit facility of $200.0 million; and
  • Participated in drilling 20 gross (13.05 net) wells(3) in Colombia resulting in 10 oil wells, 2 abandoned wells, 3 suspended wells and 5 wells under test, for a success rate of 83%. 

The full release is available here.

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