TSX-V: ORC.A, ORC.B
TORTOLA, British Virgin
Islands, May 29, 2013 /CNW/ -
Orca Exploration Group Inc. ("Orca" or "the Company") announces its
results for the first quarter ended 31 March
2013.
Highlights
- During the quarter there were no payments received from
TANESCO. At 31 March 2012, TANESCO
owed the Company US$48.8 million
(including arrears of US$44.0
million) compared to US$33.3
million (including arrears of US$28.4
million) as at 31 December
2012.
- Subsequent to the end of the quarter, the Company has received
US$19.8 million from TANESCO and
current arrears total US$29.1
million.
- Additional Gas sales continued at capacity during Q1 averaging
61.6 MMcfd being an increase of 16% over the prior period (Q1 2012:
52.9 MMcfd) and up 2% over Q4 2012 (60.2 MMcfd).
- Industrial sales volume increased by 7% to 13.1 MMcfd from 12.2
MMcfd in Q4 2012. Power sector sales volumes essentially unchanged
over Q4 2012 at 48.5 MMcfd.
- Average Industrial gas price for the quarter was US$7.78/mcf down 9% from Q4 2012 (US$8.56/mcf) a result of applying contract terms
applicable for 2013 as agreed with the largest industrial off-taker
of natural gas which took effect in January
2013, together with the sales mix.
- Power sector gas price for the quarter was US$3.55/mcf down 2% over Q4 2012 price of
US$3.61/mcf, a result of slightly
lower volumes to the power sector which combined for a lower price
under the terms of the PGSA.
- Capital cost pools were depleted in Q4 2012, which resulted in
a significant reduction in net revenues, earnings and funds from
operations. Accordingly, revenue of US$13.2
million was down 36% over Q4 2012 (US$20.7 million).
- Funds from operations before working capital changes of
US$8.7 million (US$0.25 per share diluted) were down 26% from Q4
2012 (US$11.7 million or US$0.33 per share diluted).
- Q1 earnings were US$2.95 million
or US$0.08 per share diluted, down
47% from Q4 2012 (US$5.6 million or
US$0.16 per share diluted).
- Working capital increased by 16% to US$54.8 million at 31
March 2013 (US$46.8 million as
at 31 December 2012) as a consequence
of negligible capital expenditures during the quarter.
- Subsequent to the end of the quarter, in April 2013, the Company tabled a proposed
amendment to the Songo Songo PSA for review and consideration by
the Government of Tanzania. No
further progress was made on the GNT issues.
- In April 2013, the Company
commenced negotiations with TPDC as aggregator for the sale of
incremental gas volumes of up to approximately 120 MMcfd.
- In May 2013, the Government of
Tanzania tabled a second draft
Natural Gas Policy in Parliament which limited the policy to mid-
and down-stream issues, indicating a separate policy was being
prepared on upstream issues.
- Development of Songo Songo production capacity, including
workovers of existing wells and the drilling of an additional
production well SS-12, continues to be on hold until TANESCO
arrears are fully paid, GNT issues are fully resolved and
acceptable commercial terms for the sale of incremental gas has
been agreed.
Financial and Operating Highlights
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Three months ended/As at |
31-Mar-2013 |
31-Mar- 2012 |
Change |
31-Dec-2012 |
Change |
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|
|
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|
Financial (US$000 except where otherwise
stated) |
|
|
|
|
|
Revenue |
13,197 |
17,207 |
(23%) |
20,713 |
(36%) |
Profit before taxation |
4,660 |
10,154 |
(54%) |
10,319 |
(55%) |
Operating netback (US$/mcf) |
2.15 |
2.55 |
(16%) |
3.01 |
(29%) |
Cash and cash equivalents |
13,421 |
30,635 |
(56%) |
16,047 |
(16%) |
Working capital (1) |
54,757 |
47,063 |
16% |
46,819 |
17% |
Shareholders' equity |
128,885 |
113,051 |
14% |
125,935 |
2% |
Total comprehensive income |
2,950 |
6,392 |
(54%) |
5,593 |
(47%) |
Earnings per share - basic
(US$) |
0.08 |
0.19 |
(58%) |
0.16 |
(50%) |
Earnings per share - diluted
(US$) |
0.08 |
0.18 |
(56%) |
0.16 |
(50%) |
Funds flow from operating activities |
8,699 |
9,888 |
(12%) |
11,699 |
(26%) |
Funds per share from operating activities -
basic (US$) |
0.25 |
0.28 |
(11%) |
0.34 |
(26%) |
Funds per share from operating activities -
diluted (US$) |
0.25 |
0.28 |
(11%) |
0.33 |
(24%) |
Net cash flows from operating activities |
(5,748) |
6,653 |
(186%) |
9,138 |
(163%) |
Net cash flows per share from operating activities
- basic (US$) |
(0.17) |
0.19 |
(189%) |
0.26 |
(165%) |
Net cash flows per share from operating activities
- diluted (US$) |
(0.16) |
0.19 |
(184%) |
0.26 |
(162%) |
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Outstanding Shares ('000) |
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|
|
|
Class A shares |
1,751 |
1,751 |
0% |
1,751 |
0% |
Class B shares |
32,892 |
32,743 |
0% |
32,892 |
0% |
Options |
1,922 |
2,257 |
(15%) |
1,922 |
0% |
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Operating |
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|
|
|
|
Additional Gas sold (MMcf) -
industrial |
1,176 |
835 |
41% |
1,127 |
4% |
Additional Gas sold (MMcf) - power |
4,363 |
3,973 |
10% |
4,417 |
(1%) |
Additional Gas sold (MMcfd) -
industrial |
13.1 |
9.2 |
42% |
12.2 |
7% |
Additional Gas sold (MMcfd) - power |
48.5 |
43.7 |
11% |
48.0 |
1% |
Additional Gas sold (MMcfd) |
61.6 |
52.9 |
16% |
60.2 |
2% |
Average price per mcf (US$) -
industrial |
7.78 |
9.63 |
(19%) |
8.56 |
(9%) |
Average price per mcf (US$) - power |
3.55 |
2.72 |
30% |
3.61 |
(2%) |
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- Working capital as at 31 March
2013 includes a TANESCO receivable of US$48.8 million (31
December 2012: US$33.3
million) and a net Songas receivable of US$5.5 million (31
December 2012: US$5.9
million). Subsequent to the end of the quarter, TANESCO paid
US$19.8 million, and the current
TANESCO arrears total US$29.1
million.
Condensed Consolidated Interim Statement of Comprehensive
Income (Unaudited)
ORCA EXPLORATION GROUP INC.
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Three months
ended |
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US$'000s except per share
amounts |
NOTE |
|
31 Mar 2013 |
31 Mar 2012 |
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Revenue |
|
|
13,197 |
17,207 |
Cost of sales |
|
|
|
|
Production and distribution expenses |
|
|
(794) |
(1,316) |
Depletion expense |
|
|
(2,722) |
(1,938) |
|
|
|
|
|
|
|
|
9,681 |
13,953 |
General and administrative expenses |
|
|
(3,530) |
(3,664) |
Net finance costs |
|
|
(1,491) |
(135) |
|
|
|
|
|
Profit before taxation |
|
|
4,660 |
10,154 |
Taxation |
|
|
(1,886) |
(3,762) |
|
|
|
|
|
Profit after taxation |
|
|
2,774 |
6,392 |
Foreign currency translation gain from foreign
operations |
|
|
176 |
- |
|
|
|
|
|
Total comprehensive income for the
period |
|
|
2,950 |
6,392 |
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|
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Earnings per share |
|
|
|
|
|
|
|
|
|
Basic (US$) |
|
|
0.08 |
0.19 |
Diluted (US$) |
|
|
0.08 |
0.18 |
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|
|
|
See accompanying notes to the condensed
consolidated interim financial statements.
Condensed Consolidated Interim Statement of
Financial Position (Unaudited)
ORCA EXPLORATION GROUP INC.
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|
AS
AT |
US$'000s |
NOTE |
31-Mar 2013 |
31-Dec 2012 |
ASSETS |
|
|
|
Current Assets |
|
|
|
Cash and cash equivalents |
|
13,421 |
16,047 |
Trade and other receivables |
|
93,267 |
73,495 |
Taxation receivable |
|
14,371 |
14,692 |
Prepayments |
|
208 |
246 |
|
|
121,267 |
104,480 |
Non-Current Assets |
|
|
|
Exploration and evaluation assets |
|
5,722 |
5,720 |
Property, plant and equipment |
|
99,503 |
102,044 |
|
|
105,225 |
107,764 |
Total Assets |
|
226,492 |
212,244 |
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|
EQUITY AND LIABILITIES |
|
|
|
Current Liabilities |
|
|
|
Trade and other payables |
|
52,398 |
45,496 |
Bank loan |
|
9,058 |
5,842 |
Taxation payable |
|
5,053 |
6,322 |
|
|
66,509 |
57,660 |
Non-Current Liabilities |
|
|
|
Deferred income taxes |
|
19,813 |
20,399 |
Deferred additional profits tax |
|
11,285 |
8,250 |
|
|
31,098 |
28,649 |
Total Liabilities |
|
97,607 |
86,309 |
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Equity |
|
|
|
Capital stock |
|
84,983 |
84,983 |
Contributed surplus |
|
6,753 |
6,753 |
Accumulated other comprehensive income |
|
265 |
89 |
Accumulated income |
|
36,884 |
34,110 |
|
|
128,885 |
125,935 |
Total Equity and Liabilities |
|
226,492 |
212,244 |
See accompanying notes to the condensed consolidated interim
financial statements.
Future operations (Note 1)
Contractual obligations and committed capital investment (Note
13)
Contingencies (Note 14)
The consolidated condensed interim financial statements were
approved by the Board of Directors on 29 May
2013.
Condensed Consolidated Interim Statement of
Cash Flows (Unaudited)
ORCA EXPLORATION GROUP INC.
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Three
months ended |
US$'000s |
NOTE |
31 Mar 2013 |
31 Mar 2012 |
CASH FLOWS (USED IN)/FROM OPERATING
ACTIVITIES |
|
|
|
Profit after taxation |
|
2,774 |
6,392 |
Adjustment for: |
|
|
|
|
Depletion and depreciation |
|
2,809 |
2,019 |
|
Impairment of assets |
|
- |
- |
|
Stock-based compensation |
|
(271) |
6 |
|
Deferred income taxes |
|
(582) |
722 |
|
Deferred additional profits tax |
|
3,035 |
672 |
|
Interest received |
|
- |
(1) |
|
Unrealised loss on foreign exchange |
|
934 |
78 |
Funds flow from operating
activities |
|
8,699 |
9,888 |
Increase in trade and other
receivables |
|
(20,928) |
(2,118) |
Decrease/Increase in taxation
receivable |
|
320 |
(3,828) |
Decrease in prepayments |
|
38 |
(40) |
Increase in trade and other
payables |
|
7,392 |
534 |
Increase in taxation payable |
|
(1,269) |
2,217 |
Net cash flows from operating
activities |
|
(5,748) |
6,653 |
CASH FLOWS USED IN INVESTING
ACTIVITIES |
|
|
|
Exploration and evaluation
expenditures |
|
(2) |
(1,578) |
Property, plant and equipment
expenditures |
|
(268) |
(17,170) |
Interest received |
|
- |
1 |
Increase/(decrease) in trade and other
payables |
|
- |
8,072 |
Net cash used in investing
activities |
|
(270) |
(10,675) |
CASH FLOWS (USED IN)/FROM FINANCING
ACTIVITIES |
|
|
|
Bank loan proceeds |
|
4,000 |
|
Bank loan repayments |
|
(785) |
- |
Net cash flow from/ (used in)
financing activities |
|
3,215 |
- |
Decrease in cash and cash
equivalents |
|
(2,803) |
(4,022) |
Cash and cash equivalents at the
beginning of the period |
|
16,047 |
34,680 |
Effect of change in foreign
exchange |
|
177 |
(23) |
Cash and cash equivalents at the
end of the period |
|
13,421 |
30,635 |
See accompanying notes to the condensed
consolidated interim financial statements.
Condensed Consolidated Interim Statement of
Changes in Shareholders' Equity (Unaudited)
ORCA EXPLORATION GROUP INC.
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|
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|
US$'000 |
Capital stock |
Contributed
surplus |
Cumulative
translation
adjustment |
Accumulated
income |
Total |
Note |
|
|
|
|
|
|
|
|
|
|
|
Balance as at 1 January 2013 |
84,983 |
6,753 |
89 |
34,110 |
125,935 |
Foreign currency translation adjustment on foreign
operations |
- |
- |
176 |
- |
176 |
Total comprehensive income for the period |
- |
- |
- |
2,774 |
2,774 |
Balance as at 31 March 2013 |
84,983 |
6,753 |
265 |
36,884 |
128,885 |
|
|
|
|
|
|
US$'000 |
Capital stock |
Contributed
surplus |
Cumulative
translation
adjustment |
Accumulated
income |
Total |
Balance as at 1 January 2012 |
84,610 |
6,268 |
- |
15,781 |
106,659 |
Foreign currency translation adjustment on foreign
operations |
- |
- |
- |
- |
- |
Total comprehensive income for the period |
- |
- |
- |
6,392 |
6,392 |
Balance as at 31 March 2012 |
84,610 |
6,268 |
- |
22,173 |
113,051 |
Orca Exploration Group Inc.
Orca Exploration Group Inc. is an international
public company engaged in natural gas exploration, development and
supply in Tanzania through the
wholly-owned subsidiary PanAfrican Energy Tanzania Limited, as well
as oil and gas appraisal in Italy.
Orca trades on the TSXV under the trading symbols ORC.B and ORC.A.
The complete condensed interim consolidated financial statements
and notes, as well as Management's Discussion & Analysis may be
found on the Company's website www.orcaexploration.com or on
www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Forward Looking Statements
This press release contains forward-looking
statements. More particularly, this press release contains
statements concerning, but not limited to, incremental gas sales
volumes; status of development of the Songo Songo production
capacity; the terms of the Government of Tanzania's draft Natural Gas Policy; and the
Company's strategic plans. Although management believes that the
expectations reflected in the forward-looking statements are
reasonable, it cannot guarantee future results, levels of activity,
performance or achievement since such expectations are inherently
subject to significant business, economic, operational,
competitive, political and social uncertainties and contingencies.
Many factors could cause Orca's actual results to differ materially
from those expressed or implied in any forward-looking statements
made by Orca.
These forward-looking statements involve
substantial known and unknown risks and uncertainties, certain of
which are beyond Orca's control, including, but not limited to, the
impact of general economic conditions in the areas in which Orca
operates; civil unrest; industry conditions; changes in laws and
regulations including the adoption of new environmental laws and
regulations and changes in how they are interpreted and enforced;
increased competition; the lack of availability of qualified
personnel or management; fluctuations in commodity prices; foreign
exchange or interest rates; stock market volatility; competition
for, among other things, capital, drilling equipment and skilled
personnel; failure to obtain required equipment for drilling;
delays in drilling plans; failure to obtain expected results from
drilling of wells; effect of changes to the PSA on the Company;
changes in laws; imprecision in reserve estimates; the production
and growth potential of the Company's assets; obtaining required
approvals of regulatory authorities; risks associated with
negotiating with foreign governments; ability to access sufficient
capital; and risk that the Company will not be able to fulfill its
obligations. In addition there are risks and uncertainties
associated with oil and gas operations, therefore Orca's actual
results, performance or achievement could differ materially from
those expressed in, or implied by, these forward-looking estimates
and, accordingly, no assurances can be given that any of the events
anticipated by the forward-looking estimates will transpire or
occur, or if any of them do so, what benefits that Orca will derive
therefrom.
Such forward-looking statements are based on
certain assumptions made by Orca in light of its experience and
perception of historical trends, current conditions and expected
future developments, as well as other factors Orca believes are
appropriate in the circumstances, including, but are not limited
to, the ability of Orca to add production at a consistent rate;
infrastructure capacity; commodity prices will not deteriorate
significantly; the ability of Orca to obtain equipment in a timely
manner to carry out exploration, development and exploitation
activities; future capital expenditures; availability of skilled
labour; timing and amount of capital expenditures; uninterrupted
access to infrastructure; the impact of increasing competition;
conditions in general economic and financial markets; effects of
regulation by governmental agencies; that the Company will have
sufficient cash flow, debt or equity sources or other financial
resources required to fund its capital and operating expenditures
and requirements as needed; current or, where applicable, proposed
industry conditions, laws and regulations will continue in effect
or as anticipated as described herein; and other matters.
The forward-looking statements contained in
this press release are made as of the date hereof and Orca
undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise, unless so required by
applicable securities laws.
SOURCE Orca Exploration Group Inc.