Toreador Reports Improved Second-Quarter Results.Energy Editors/Business Editors DALLAS--(BUSINESS WIRE)--Aug. 12, 2003 Toreador Resources Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :TRGL) (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :TRX TRX Transceiver TRX Transaction TRx Total Prescription TRX Token Ring Switch TRX Transmit and Receive ) today reports improved second-quarter 2003 financial results, with income applicable to common shares of $445,000, or $0.05 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared with a loss applicable to common shares of $581,000, or $0.06 per diluted share, for the second quarter of 2002. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the second quarter of 2003 was $508,000, compared with operating income of $482,000 for the same period last year. Lower general and administrative expenses and DD&A primarily accounted for the improvement in second-quarter 2003 operating results compared with the year-ago period. Results include a one-time charge of $466,000 for a reduction in force implemented during the second quarter, which includes the company's severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when obligation. In addition, the company reduced long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. 26% for the 12 months ended June 30, 2003. A decline in oil and gas sales and an $816,000 loss related to oil and gas production hedges reduced second-quarter 2003 revenues to $5.1 million, down 18% from the year-ago period. Revenues of $6.2 million for the second quarter of 2002 included a loss of $288,000 related to oil and gas production hedges. "We have refocused our operating strategy and aggressively reduced debt, and we are pleased with our continued profitability," said G. Thomas Graves
Admiral Sir Thomas Graves KB RN (1747?–1814), admiral, third son of the Rev. III, President and Chief Executive Officer of Toreador. "A vast improvement in net cash provided by operating activities in the second quarter is indicative of our more efficient management of the business. The financial outlook for the remainder of the year is positive. "We have reduced the work force by one-third since year-end 2002 and beginning in the third quarter, G&A expenses should level off to a normalized quarterly range of about $1.3 million-$1.5 million," he continued. Toreador expects to strengthen its balance sheet by continuing to reduce long-term debt and increasing stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. , according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Graves. The company continues to diligently dil·i·gent adj. Marked by persevering, painstaking effort. See Synonyms at busy. [Middle English, from Old French, from Latin d explore alternatives to refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. all or part of its capital structure. During the second quarter of 2003, Toreador's oil and gas production was 231,100 barrels of oil equivalent (BOE BOE Based on Experience BOE Board of Education BOE Boletín Oficial del Estado (Spanish) BOE Bank of England BOE Board of Equalization BOE Board of Elections BOE Barrel of Oil Equivalent BOE Bind on Equip ) versus second-quarter 2002 production of 267,700 BOE. The company's oil production declined due to the third-quarter 2002 sale of its 25% working interest in a Kansas oil field and lower production volumes from four 100%-owned French oil fields This list of oil fields includes major fields of the past and present. The list is incomplete; there are more than 40,000 oil and gas fields of all sizes in the world[1]. in the Neocomian complex. During the third quarter, an extensive well workover program was initiated to improve production from the French fields French Fields is a British situation comedy. It ran for 19 episodes from 1989-1991. It was written by John T Chapman and Ian Davidson and was produced by Thames Television for ITV. . In addition, natural-gas production also declined as a result of the temporary loss of two gas producing wells in which the company has interests. Lower oil and gas sales volumes were somewhat offset by higher commodity prices in the quarter. The company's second-quarter 2003 average realized price per BOE rose 12% to $25.65 from $22.95 per BOE for the second quarter of 2002. In 2003, the company has hedged approximately 85% of its natural-gas production at about $5.00 per thousand cubic feet (Mcf). In addition, Toreador has hedged approximately 50% of its international oil production at a $26.00 per barrel ceiling based on Brent crude Brent Crude is one of the major classifications of oil consisting of Brent Crude, Brent Sweet Light Crude, Oseberg and Forties. Brent Crude is sourced from the North Sea. The Brent Crude oil marker is also known as Brent Blend, London Brent and Brent petroleum. pricing. None of its domestic oil is hedged. Approximately 50% of oil and gas production on a BOE basis is hedged at an average ceiling price of approximately $26.65 per BOE. "With slightly more than 50% of our estimated 2003 production free of hedges, we should be able to continue to participate in higher commodity pricing," said Graves. "Nearly two-thirds of our oil production remains unhedged; therefore, we expect stronger oil prices to have a positive impact on results. Based on current natural-gas futures prices Futures price The price at which parties to a futures contract agree to transact upon the settlement date. , we estimate a gain on commodity derivatives for the third quarter of 2003. Current hedges are primarily in place to satisfy credit-facility requirements." SIX-MONTH RESULTS For the first six months of 2003, Toreador reports significantly improved financial results. Income applicable to common shares was $1.1 million, or $0.12 per diluted share, compared with a loss applicable to common shares of $2.5 million, or $0.27 per diluted share, for the second quarter of 2002. Operating income for the first half of 2003 was $2.1 million, compared with an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $1.4 million for the same period last year. Higher oil and gas prices and lower general and administrative expenses and DD&A primarily accounted for the improvement in six-month 2003 results compared with the year-ago period. Six-month revenues were $11.5 million, which included a loss of $2.2 million related to oil and gas production hedges. As discussed earlier in this news release, lower oil and gas sales volumes were somewhat offset by higher commodity prices in the first six months of 2003. Revenues of $9.6 million for the first six months of 2002 included a loss of $2.4 million related to oil and gas production hedges. During the first six months of 2003, Toreador's oil and gas production was 482,700 BOE, compared with 563,100 BOE for the same period last year. The company's average realized price per BOE for the first six months of 2003 was $28.36, a 41% increase from an average realized price per BOE of $20.06 for the first six months of 2002. EARNINGS GUIDANCE In an effort to provide investors with more meaningful guidance regarding future financial results, Toreador's management has established the following policy: Forecasts of periodic quarterly or full-year results will be provided, affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. , updated or rescinded when the company deems it prudent and feasible to do so. OPERATIONS BRIEF Turkey Toreador's exploration focus in 2003 is the Thrace Basin The European side of Turkey is called the Thrace Basin. It is the largest and thickest Tertiary sedimentary basin in Turkey. The basin is triangular shaped, trends WNW-ESE and was formed by extension in late Middle Eocene to latest Oligocene times. and Sinop areas of western and northern Turkey. Toreador tested the Barbaros-1 well in the Thrace Basin gas play west of Istanbul and perforated per·fo·ra·ted adj. Pierced with one or more holes. two zones. Based on well-log evaluation, noncommercial quantities of gas were recovered, and the well was plugged and abandoned. As previously announced, Toreador drilled a low-cost, shallow exploratory well, the Tahtatepe-1 well, on the Gallipoli Peninsula Gallipoli Peninsula, Lat. Chersonesus Thracica, narrow peninsula, c.50 mi (80 km) long, W Turkey, extending southwestward between the Aegean Sea and the Dardanelles. The port of Gallipoli gives it its name. in the Thrace Basin, 40 miles southwest of Barbaros-1. The well followed up on gas shows encountered by other operators. The Tahtatepe-1 was deemed noncommercial, and the well was plugged and abandoned. Additional drilling in the area is being evaluated based on well results. Toreador holds working interests in four Thrace Basin licenses ranging from 50%-100% and operates them. PEMI is Toreador's partner in two of the licenses. In the Sinop area northeast of Ankara, the company plans to re-enter re·en·ter also re-en·ter v. re·en·tered, re·en·ter·ing, re·en·ters v.tr. 1. To enter or come in to again. 2. To record again on a list or ledger. v.intr. a well that encountered numerous oil and gas shows when it was drilled by another operator in the late 1980s. Toreador operates and holds a 100% working interest in six Sinop permits. In the shallow-water western Black Sea, Toreador has identified at least six gas prospects with per-prospect reserve potential ranging from 200 billion cubic feet to 1 trillion One thousand times one billion, which is 1, followed by 12 zeros, or 10 to the 12th power. See space/time. (mathematics) trillion - In Britain, France, and Germany, 10^18 or a million cubed. In the USA and Canada, 10^12. cubic feet. The company anticipates selecting two well locations, with drilling targeted to begin in 2004. Toreador is operator and holds a 49% working interest in eight Black Sea permits. The Turkish national oil company, TPAO TPAO Türkiye Petrolleri Anonim Ortakligi (Turkish Petroleum Corporation) , holds the remaining interest. In the Cendere Field in south central Turkey, Toreador's development program continues. As previously disclosed, it is anticipated that a 3D seismic survey will delineate the northeastern portion of the field and help the company identify additional drilling locations on the structure. The Cendere Field, in which Toreador holds a 19.6% working interest, is operated by TPAO and is producing at a gross rate of 1,325 barrels of oil per day (BOPD BOPD Barrels of Oil Per Day BOPD Bataan Ocean Petroleum Depot ) (about 260 BOPD net). The Zeynel Field, 15 miles to the southwest of Cendere, is producing at a gross rate of 350 BOPD (about 30 BOPD net). Upcoming work in the field includes re-entering the Zeynel-6 development well to test the deeper Derdere formation. Toreador has an 8.5% royalty interest royalty interest The proportional ownership interest by the owner of oil and gas rights in income produced by the asset. See also overriding royalty interest. in the Zeynel Field, which is operated by Aladdin Middle East. France Current production from Toreador's five 100%-owned oil fields in France is about 1,000 BOPD. Production from the company's four-field Neocomian complex has declined because of routine well maintenance requirements. As noted earlier in this news release, the company has initiated an extensive workover program to improve production. Toreador, operator of the fields, anticipates French production returning to a more normal level of about 1,200 BOPD when the workover project has been completed in the third quarter. As previously announced, if 2003 capital allocation permits, Toreador plans to implement a development program that will include several extensive well workovers and the drilling of development wells in the Neocomian complex to further exploit this area. Trinidad As previously announced, Toreador holds a 1% override An arrangement whereby commissions are made by sales managers based upon the sales made by their subordinate sales representatives. A term found in an agreement between a real estate agent and a property owner whereby the agent keeps the right to receive a commission for the sale of in Trinidad. The company previously has stated that it was not participating in future exploration on Trinidad's Southwest Peninsula Block. United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. In the second quarter of 2003, Toreador continued to earn significant revenues, or $2.0 million, from its U.S. oil and gas perpetual-fee mineral and royalty interest portfolio. This amount represented 33% of total revenues. During the first six months of 2003, seven wells were completed for production on the company's mineral holdings. Currently, two wells are being drilled. The wells on Toreador's mineral interests are drilled and completed by various operators at no cost or risk to the company. Mineral and royalty interest revenues provide a solid financial foundation on which Toreador continues to build its worldwide exploration and development program. Less than 5% of the more than 1.4 million net acres in the company's U.S. mineral portfolio are leased or producing, which provides potential for additional future revenues from the remaining unleased acreage. The Walton Gas Unit 2-2 well located on the 1,000-acre Walton Gas Unit prospect has been completed and is producing at a rate of 300 Mcf per day. Part of the Bethel Bethel, in the Bible Bethel (bĕth`əl) [Heb.,=house of God]. 1 Ancient city of central Palestine, the modern Baytin, the West Bank, N of Jerusalem. Dome Project in Anderson County Anderson County is the name of five counties in the United States:
In West Texas, the company owns a 16.6% working interest in 6,000 gross acres where one well has been successfully completed in the San Andres formation and a second well, also in the San Andres, has been completed, tested and shut in for evaluation. ABOUT TOREADOR Toreador Resources Corporation is an independent international energy company engaged in the acquisition, development, exploration and production of natural gas, crude oil and other income-producing minerals. The company holds interests in developed and undeveloped oil and gas properties in France, Romania, Turkey and Trinidad, West Indies West Indies, archipelago, between North and South America, curving c.2,500 mi (4,020 km) from Florida to the coast of Venezuela and separating the Caribbean Sea and the Gulf of Mexico from the Atlantic Ocean. . In the United States, Toreador primarily owns perpetual PERPETUAL. That which is to last without limitation as to time; as, a perpetual statute, which is one without limit as to time, although not expressed to be so. oil and gas mineral and royalty interests in eight states and working interests in five states. More information about Toreador may be found at the company's web site, www.toreador.net. Safe-Harbor Statement -- Except for the historical information contained herein, the matters set forth in this news release are "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " 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. The company intends that all such statements be subject to the "safe-harbor" provisions of those Acts. Many important risks, factors and conditions may cause the company's actual results to differ materially from those discussed in any such forward-looking statement. These risks include, but are not limited to, estimates of reserves, estimates of production, future commodity prices, exchange rates, interest rates, geological and political risks, drilling risks, product demand, transportation restrictions, the ability of Toreador to obtain additional or alternative capital, and other risks and uncertainties described in the company's filings with the Securities and Exchange Commission (SEC). The historical results achieved by the company are not necessarily indicative of its future prospects. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Cautionary Notes to Investors -- The Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves proved reserves The quantity of minerals expected to be recoverable under current economic and operating conditions. The amount of proved reserves is important in valuing the stock of a company with significant holdings in natural resources. that a company has demonstrated by actual production or conclusive Determinative; beyond dispute or question. That which is conclusive is manifest, clear, or obvious. It is a legal inference made so peremptorily that it cannot be overthrown or contradicted. formation tests to be economically and legally producible under existing economic and operating conditions. Toreador uses the term "potential reserves" in this news release, which the SEC's guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. strictly prohibit pro·hib·it tr.v. pro·hib·it·ed, pro·hib·it·ing, pro·hib·its 1. To forbid by authority: Smoking is prohibited in most theaters. See Synonyms at forbid. 2. it from including in filings with the SEC. Investors are urged to also consider closely the disclosure in Toreador's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended December 31, 2002, available from the company by calling 214.559.3933 or 800.966.2141. This form also can be obtained from the SEC at www.sec.gov. The term "potential," when referring to Toreador's reserves, represents Toreador management's current belief or judgment, based on information available to it, regarding the potential reserves that could be recovered or could be recoverable. These numbers should not be viewed as reliable for the purposes of estimating Toreador's reserves or its prospects. Additionally, the term "potential" has no engineering significance and is not related to the term "possible" as that term may be used by the Society of Petroleum Engineers.
TOREADOR RESOURCES CORPORATION
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30 June 30
------------------ -------------------
SELECTED FINANCIAL RESULTS 2003 2002 2003 2002
-------- -------- -------- ---------
Revenues:
Oil and gas sales $ 5,823 $ 6,244 $ 13,412 $ 11,565
Loss on commodity derivatives (816) (288) (2,158) (2,434)
Lease bonus and rentals 89 231 204 501
-------- -------- -------- ---------
Total revenues 5,096 6,187 11,458 9,632
Costs and expenses:
Lease operating 1,671 1,793 3,426 3,729
Exploration and acquisition 247 204 399 449
Depreciation, depletion, and
amortization 602 1,621 1,928 3,173
Reduction in force 466 - 466 -
General and administrative 1,602 2,087 3,098 3,669
-------- -------- -------- ---------
Total costs and expenses 4,588 5,705 9,317 11,020
-------- -------- -------- ---------
Operating income (loss) 508 482 2,141 (1,388)
Other expense 375 (1,406) 36 (1,992)
Provision (benefit) from income
taxes 327 (433) 806 (1,033)
-------- -------- -------- ---------
Net income (loss) 556 (491) 1,371 (2,347)
Dividends on preferred shares 111 90 222 180
-------- -------- -------- ---------
Income (loss) applicable to
common shares $ 445 $ (581) $ 1,149 $ (2,527)
======== ======== ======== =========
Basic income (loss) per share $ 0.05 $ (0.06) $ 0.12 $ (0.27)
======== ======== ======== =========
Diluted income (loss) per share $ 0.05 $ (0.06) $ 0.12 $ (0.27)
======== ======== ======== =========
Weighted average shares
outstanding:
Basic 9,338 9,349 9,338 9,349
Diluted 9,361 9,349 9,361 9,349
SELECTED OPERATING RESULTS
Production
Oil production (MBbl) 166 191 338 402
Natural gas production (MMcf) 391 460 868 965
Equivalent production (MBOE) 231 268 483 563
Prices
Average oil price per Bbl $ 23.92 $ 23.13 $ 26.57 $ 20.89
Average natural gas price per
Mcf 5.01 3.57 5.43 3.00
Average equivalent price (per
BOE) 25.65 22.95 28.36 20.06
June 30
SELECTED BALANCE SHEET -----------------
INFORMATION 2003 2002
------- --------
Cash flow from operating
activities before change in
working capital $ 4,121 $ 4,051
Oil and gas properties, net 77,928 73,111
Total assets 90,727 88,933
Long-term debt 23,985 32,625
Stockholders' equity 32,365 30,021
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion