Toreador Reports Strong Second Quarter 2006 Operating Results; First Quarter Results Revised Upwards; Mid-Year Reserves Updated.DALLAS Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. -- 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): --Second quarter 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. up 65% from second quarter of 2005 --Income available to common shares up 39% compared to second quarter of 2005 --EBITDAX(a) in second quarter up 71% from the same period last year --First quarter 2006 income available to common shares revised up to $2.9 million, or $0.18 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, from previously reported $1.2 million, or $0.08 per diluted share --South Akcakoca Sub-basin reserve estimates remains on track with initial projections
($ millions, except where Q2 Q2
noted) 2006 2005 Change (units) Change (%)
------ ------ -------------- ----------
Revenue $10.3 $7.2 3.1 43%
Operating income 2.8 1.7 1.1 65%
EBITDAX(a) 5.3 3.1 2.2 71%
Income available to common
shares 2.5 1.8 0.7 39%
Basic income per share
($/share) $0.16 $0.13 0.03 23%
Diluted income per share
($/share) $0.15 $0.12 0.03 25%
Production (MBOE) 166 154 12 8%
Toreador Resources Corporation (NASDAQ: TRGL) today announced financial results for the second quarter of 2006. SECOND QUARTER RESULTS For the second quarter of 2006, Toreador reported income available to common shares of $2.5 million, or $0.15 per diluted share, compared to $1.8 million in the second quarter of 2005, or $0.12 per diluted share. Diluted weighted average shares outstanding in the second quarter of 2006 were 16.8 million, compared to 15.6 million diluted weighted average shares outstanding in the second quarter of 2005. Earnings before interest, taxes, depreciation, amortization and exploration expense (EBITDAX Earnings Before Interest, Taxes, Depreciation, Depletion, Amortization, and Exploration Expenses - EBITDAX An indicator of a company's financial performance calculated as: )(a) was $5.3 million in the three months ended June June: see month. 30, 2006 compared to $3.1 million for the same period last year. Total revenues for the three months ended June 30, 2006 were $10.3 million, compared to $7.2 million for the same period in 2005. Operating income in the second quarter of 2006 was $2.8 million, compared to $1.7 million in the second quarter of 2005. "Oil prices in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). were quite favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. during the quarter," 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, "with Brent Brent, outer borough (1991 pop. 226,100) of Greater London, SE England. The area is a rail and industrial center. Its manufactures include automobile parts, clocks and watches, and electrical equipment. spot prices sometimes exceeding West Texas Intermediate. Forward oil strip prices have also been firming up in Europe, which is a positive leading indicator Leading Indicator A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators are used to predict changes in the economy, but are not always accurate. for the economics of our third and fourth quarter exploration programs in Romania Romania (rōmān`ēə, –yə) or Rumania (r  –), republic (v), 91,699 sq mi (237,500 sq km), SE Europe. and
France."In the second quarter of 2006, Toreador's oil and gas production was approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 166 thousand barrels of oil equivalent (MBOE MBOE Thousands of Barrels of Oil Equivalent MBOE Milford Board of Education ) compared to 154 MBOE during the same period last year. The average realized price on a 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 basis in the second quarter of 2006 was $61.84 per BOE compared to $46.26 per BOE in the second quarter of 2005. The average realized price of oil in the second quarter of 2006 was $65.06 per barrel barrel: see English units of measurement. compared to $47.31 per barrel in the second quarter of 2005. The average realized price of natural gas in the quarter ended June 30, 2006 was $6.67 per thousand cubic feet (Mcf), compared to $6.69 per Mcf for the same period last year. RESTATED FIRST QUARTER 2006 RESULTS Toreador also announced today that it has restated financial results for the first quarter of 2006 to reverse a non-cash loss contingency contingency n. an event that might not occur. on an insurance receivable of $1.5 million. The restatement Restatement A revision in a company's earlier financial statements. Notes: The need for restating financial figures can result from fraud, misrepresentation, or a simple clerical error. also includes the capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. of interest expense of approximately $631 thousand associated with Toreador's development operations in Turkey. The net effect of the restatement was an increase in operating income and income available to common shares that is described in the table below:
As
($ millions, except Restated Reported
where noted) Q1 2006 Q1 2005 Change (units) Change (%)
-------- --------- -------------- ---------
Operating income 2.3 1.2 1.1 92%
Income available to
common shares 2.9 1.0 1.9 190%
Basic income per share
($/share) $0.19 $0.08 0.11 138%
Diluted income per share
($/share) $0.18 $0.08 0.10 125%
Restated operating income for the first quarter of 2006 was $2.3 million, an increase of 92% from the first quarter of 2005. Restated income available to common shares for the quarter ended March 31, 2006 was $2.9 million, or $0.18 per diluted share, up 125% from the same period last year. SIX MONTHS RESULTS Financial results for the first six months of 2006 include increases in operating income of 76%, EBITDAX(a) of 80%, and income available to common shares of 96% compared to the first six months of 2005. Revenues increased 48% on production growth of 13% in the first six months of 2006 compared to the same period in the prior year.
Six months
ended
June 30,
-------------
($ millions, except where
noted) 2006 2005 Change (units) Change (%)
----- ----- -------------- ----------
Revenue $20.1 $13.6 6.5 48%
Operating income 5.1 2.9 2.2 76%
EBITDAX(a) 10.1 5.6 4.5 80%
Income available to common
shares 5.5 2.8 2.7 96%
Basic income per share
($/share) $0.35 $0.21 0.14 67%
Diluted income per share
($/share) $0.33 $0.20 0.13 65%
Production (MBOE) 341 303 38 13%
For the first half of 2006, Toreador's oil and gas production was approximately 341 MBOE compared to 303 MBOE for the first half of 2005. The average realized price in the first six months of 2006 was $58.39 per BOE compared to $44.45 per BOE for the first six months of 2005. The average realized price of oil in the first half of 2006 was $61.18 compared to $45.42 for the same period a year ago. The average realized price of natural gas for the six months ended June 30, 2006 was $6.35 per MCF compared to $6.44 per MCF for the six months ended June 30, 2005. MID-YEAR RESERVE UPDATE Toreador today provided an interim updated estimate of proved and probable PROBABLE. That which has the appearance of truth; that which appears to be founded in reason. reserves at June 30, 2006, and included an updated study of possible reserves and the unrisked reserve potential of the South Akcakoca Sub-basin natural gas project offshore Turkey in the Black Sea. The estimates were provided by independent petroleum engineers LaRoche Laroche may refer to:
Table: Interim Update to Toreador Reserves Estimates as of June 30,
2006
Net Reserves
-------------------
Oil Gas NPV (1)
Reserve Category (MBO) (MMcf) ($thousands)
----------------------------------------------------- -------------
Proved Developed Producing 8,064 7,810 $176,732
Proved Developed Non-producing 446 174 7,144
Proved Undeveloped 3,297 15,481 106,040
------------------------------------------------------ --------
Total Proved 11,807 23,465 289,916
====================================================== ========
Total Proved MBOE 15,718
Probable 5,018 4,561 81,868
------------------------------------------------------ --------
Probable MBOE 5,778
Total Proved + Probable 16,825 28,026 $371,784
------------------------------------------------------ --------
Proved +Probable MBOE 21,496
Notes:
------
(1) Pre-tax Net Present Value discounted at 10%
At mid-year, Toreador's estimated 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. were approximately 15.7 million BOE, up approximately 700 thousand BOE from the company's proved reserves of approximately 15.0 million BOE as of December December: see month. 31, 2005. The pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta net present value discounted at 10% of the estimated proved reserves as of June 30, 2006 was approximately $289.9 million compared to approximately $224.8 million as of December 31, 2005. Probable reserves at June 30, 2006 were estimated to be approximately 5.8 million BOE with a pre-tax net present value discounted at 10% of approximately $81.9 million. Total proved and probable reserves at June 30, 2006 were estimated to be approximately 21.5 million BOE with a pre-tax net present value discounted at 10% of approximately $371.8 million.
Table: Natural Gas Reserves Estimates in the South Akcakoca Sub-
basin As of June 30, 2006
Reserve Estimates (Bcf)
-----------------------------
Reserve Category High End Likely Low End
---------------------------------------------------- ------ ---------
Proved 46 46 46
Probable 14 14 14
Possible 6 6 6
Unrisked Potential 432 127 35
---------------------------------------------------- ------ ---------
Total 498 193 101
==================================================== ====== =========
Toreador 36.75% Interest 183 71 37
In the South Akcakoca Sub-basin natural gas project, LaRoche provided an update to the estimate of total natural gas reserves (which includes proved, probable, possible and unrisked potential reserves). On a gross basis, the high-end high-end adj. Informal 1. Appealing to sophisticated and discerning customers: a high-end department store; high-end video equipment. 2. case was estimated to be approximately 498 BCF BCF Billion Cubic Feet BCF Bioconcentration Factor BCF British Chess Federation BCF British Coatings Federation BCF Breast Cancer Fund BCF Bank Credit Facility BCF Bulked Continuous Filament BCF British Cycling Federation BCF Boeing Converted Freighter , the likely case was estimated to be approximately 193 BCF, and the low-end low-end adj. 1. Cheapest in a line of merchandise: low-end subcompact cars. 2. Informal Of, relating to, or intended for low-income consumers; downscale: case was estimated to be 101 BCF. These estimates compare favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. to Toreador's initial internal estimates of 350 BCF gross for the South Akcakoca Sub-basin project. To Toreador's 36.75% interest, the high, likely and low estimates correspond to 183 BCF, 71 BCF and 37 BCF, respectively. LaRoche arrived at these estimates using the results from nine successful wells and two dry holes drilled since September September: see month. 2004, as well as data from 2D and 3D seismic surveys conducted in the South Akcakoca Sub-basin. "The South Akcakoca Sub-basin project continues to drill out as well or better than we expected," commented Graves Graves A region of southwest France in the Garonne River valley. The area is known for its fine table wines. Noun 1. Graves - English writer known for his interest in mythology and in the classics (1895-1985) . "The Ayazli-Akkaya fault trend has provided such positive results that the joint venture partners added three additional wells and a third production tripod over what was originally budgeted as we began the fiscal year. Nonetheless, we still anticipate that the bulk of the reserves in this 50,000 acre project area (out of almost 1.0 million acres in the Western Black Sea Permit) will be found in the slightly deeper waters along the Akcakoca trend. We are starting to investigate whether these trends extend to the west and will begin to evaluate the prospects in the Eregli Sub-basin which is located immediately adjacent to the northeast “Northeastern” redirects here. For the Boston college, see Northeastern University, Boston. Northeast or north east is the ordinal direction halfway between north and east. It is the opposite of southwest. See boxing the compass. later this year." OPERATIONAL UPDATE In the South Akcakoca Sub-basin project offshore Turkey in the Black Sea, the Akkaya production tripod has been successfully set. The tripod is currently being secured to the sea floor using pilings. Two more tripods will be set on the Dogu Ayazli and Ayazli structures over the next few months in the first phase of development in the project. CONFERENCE CALL A conference call to discuss second quarter 2006 results and operational activities will be held today at 9:00 am Central, 10:00 am Eastern time. Active participants who wish to ask questions during the conference call should dial toll free 866-770-7146 (international dial 1-617-213-8068), passcode 52873659 approximately 10 minutes before the scheduled call time to access the call. Those who wish only to listen to the live audio webcast may access the webcast via Toreador's internet home page at www.toreador.net by selecting the "Investor Relations Investor relations The process by which the corporation communicates with its investors. " link on the home page and then selecting the "Conference Calls" link. Those unable to participate in the live call may hear a rebroadcast for up to twelve months after the conference call at www.toreador.net by selecting the "Investor Relations" link on the home page and then selecting the "Conference Calls" link or may dial toll-free 888-286-8010 (international dial 1-617-801-6888), passcode 81949165 to listen to a replay of the call. Phone replays will be available for 14 days after the call. 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, Hungary Hungary, Hung. Magyarország, officially Republic of Hungary, republic (2005 est. pop. 10,007,000), 35,919 sq mi (93,030 sq km), central Europe. , Romania and Turkey. In the 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. , Toreador primarily owns working interests in five states. More information about Toreador may be found at the company's web site, www.toreador.net. (a)Explanation and Reconciliation of Non-GAAP Financial Measures Earnings before interest, taxes, depreciation, amortization and exploration expense (EBITDAX) is a non-GAAP measure presented because of its acceptance as an indicator Indicator Anything used to predict future financial or economic trends. Notes: In the context of technical analysis, an indicator is a mathematical calculation based on a securities price and/or volume. The result is used to predict future prices. of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. additional debt. EBITDAX should not be considered in isolation or as a substitute for operating income prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . Table 1 below reconciles EBITDAX with income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the as derived de·rive v. de·rived, de·riv·ing, de·rives v.tr. 1. To obtain or receive from a source. 2. from the company's financial information.
Table 1: Reconciliation of EBITDAX to Income from continuing
operations for the three months ended June 30,
($ thousands) 2006 2005
-------- -------
Income from continuing operations $ 2,589 $ 1,864
Income tax provision (benefit) 1,884 (185)
Interest expense 1,205 103
Interest and other income (1,668) (100)
Foreign currency exchange (gains) loss (899) 53
Gain on sale of assets (180) (12)
Equity in earnings of unconsolidated subsidiaries (96) (35)
Depletion, depreciation and amortization 1,466 950
Exploration and acquisition cost 972 431
-------- -------
EBITDAX $ 5,273 $ 3,069
======== =======
Table 2: Reconciliation of EBITDAX to Income from continuing
operations for the six months ended June 30,
($ thousands) 2006 2005
-------------------
Income from continuing operations $5,578 $3,417
Income tax provision (benefit) 2,687 (123)
Interest expense 2,481 34
Interest and other income (3,249) (345)
Foreign currency exchange (gains) loss (1,529) 40
Gain on sale of assets (651) (12)
Equity in earnings of unconsolidated
subsidiaries (192) (124)
Depletion, depreciation and amortization 2,937 1,867
Exploration and acquisition cost 2,025 805
-------------------
EBITDAX $10,087 $5,559
===================
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 a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Exchange Act of 1934, as amended. Toreador intends that all such statements be subject to the "safe-harbor" provisions of those Acts. Many important risks, factors and conditions may cause Toreador'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 ge·ol·o·gy n. pl. ge·ol·o·gies 1. The scientific study of the origin, history, and structure of the earth. 2. The structure of a specific region of the earth's crust. 3. A book on geology. and political risks, drilling risks, product demand, transportation restrictions, actual recoveries of insurance proceeds, the ability of Toreador to obtain additional capital, and other risks and uncertainties described in the company's filings with the Securities and Exchange Commission. The historical results achieved by Toreador are not necessarily indicative indicative: see mood. 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 note to investors -- The Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves 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 ec·o·nom·i·cal adj. 1. Prudent and thrifty in management; not wasteful or extravagant. See Synonyms at sparing. 2. Intended to save money, as by efficient operation or elimination of unnecessary features; economic: and legally producible under existing economic and operating conditions. We use certain terms in this release, such as probable reserves, possible reserves and potential reserves, that 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. us from including in filings with the SEC. Investors are urged to also consider closely the disclosure in our 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, 2005, available from our website at www.toreador.net or by calling us at (214) 559-3933. You can also obtain this form from the SEC at www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. Proved reserves, by the Securities and Exchange Commission definition, include proved developed producing, proved developed non-producing and proved undeveloped reserves. Probable reserves are those reserves that have not been qualified as proved reserves and that have been demonstrated to be potentially recoverable, given the higher element of risk. Possible reserves are those reserves that are less well defined than probable reserves since the risk is relatively higher as compared to probable reserves. Unrisked potential reserves are based on estimates of exploration potential.
TOREADOR RESOURCES CORPORATION
(in thousands, except per share amounts)
Three Months Ended
June 30,
----------------------
SELECTED FINANCIAL RESULTS 2006 2005
----------------------
Oil and natural gas sales revenues $ 10,303 $ 7,164
Costs and expenses:
Lease operating 2,653 2,140
Exploration and acquisition 972 431
Depreciation, depletion, and amortization 1,466 950
General and administrative 2,377 1,955
----------------------
Total costs and expenses 7,468 5,476
----------------------
Operating income 2,835 1,688
Other income (expense):
Equity in earnings of unconsolided
investments 96 35
Gain on sale of assets 180 12
Foreign currency gain (loss) 899 (53)
Interest and other income 1,668 100
Interest expense (1,205) (103)
----------------------
Total other income (loss) 1,638 (9)
Provision for income taxes (benefit) 1,884 (185)
----------------------
Income from continuing operations 2,589 1,864
Income from discontinued operations, net of tax - 1
-------- --------
Net income 2,589 1,865
Dividends on preferred shares (41) (40)
----------------------
Income available to common shares $ 2,548 $ 1,825
=======================
Basic earnings per share $ 0.16 $ 0.13
=======================
Diluted earnings per share $ 0.15 $ 0.12
=======================
Weighted average shares outstanding:
Basic 15,728 14,171
Diluted 16,775 15,610
SELECTED OPERATING RESULTS
Production
Oil production (MBbl) 144 131
Natural gas production (MMcf) 128 135
Equivalent production (MBOE) 166 154
Prices
Average oil price per Bbl $ 65.06 $ 47.31
Average natural gas price per Mcf 6.67 6.69
Average equivalent price per BOE 61.84 46.26
June 30, December 31,
----------------------
2006 2005
----------------------
SELECTED BALANCE SHEET INFORMATION
Cash and cash equivalents $ 53,728 $ 92,507
Total assets 263,147 263,180
Long-term liabilities 100,024 104,739
Stockholders' equity 134,515 134,244
TOREADOR RESOURCES CORPORATION
(in thousands, except per share amounts)
Six Months Ended
June 30,
----------------------
SELECTED FINANCIAL RESULTS 2006 2005
----------------------
Oil and natural gas sales revenues $20,072 $13,578
Costs and expenses:
Lease operating 5,088 4,260
Exploration and acquisition 2,025 805
Depreciation, depletion, and amortization 2,937 1,867
General and administrative 4,897 3,759
----------------------
Total costs and expenses 14,947 10,691
----------------------
Operating income 5,125 2,887
Other income (expense):
Equity in earnings of unconsolided investments 192 124
Gain on sale of assets 651 12
Foreign currency gain (loss) 1,529 (40)
Interest and other income 3,249 345
Interest expense (2,481) (34)
----------------------
Total other income (loss) 3,140 407
Provision for income taxes (benefit) 2,687 (123)
----------------------
Income from continuing operations 5,578 3,417
Income from discontinued operations, net of tax - 11
----------------------
Net income 5,578 3,428
Dividends on preferred shares (81) (603)
----------------------
Income available to common shares $5,497 $2,825
=======================
Basic earnings per share $0.35 $0.21
======== ========
Diluted earnings per share $0.33 $0.20
=======================
Weighted average shares outstanding:
Basic 15,618 13,490
Diluted 16,717 14,565
SELECTED OPERATING RESULTS
Production
Oil production (MBbl) 300 259
Natural gas production (MMcf) 247 260
Equivalent production (MBOE) 341 303
Prices
Average oil price per Bbl $61.18 $45.42
Average natural gas price per Mcf 6.35 6.44
Average equivalent price per BOE 58.39 44.45
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