ENCOR INC. ANNOUNCES RESULTS
ENCOR INC. ANNOUNCES RESULTS CALGARY, Alberta, Nov. 4 /PRNewswire/ -- Encor Inc.
(Toronto, Montreal: ECR) today announced its financial and operating results for the quarter and nine months ended Sept. 30, 1992. Funds generated from operations for the third quarter were $23.7 million or 15 cents per common share (9 cents per common share on a fully diluted basis), an increase of $8.7 million or 5 cents per common share (2 cents per common share on a fully diluted basis) from the third quarter of 1991. The increase was due primarily to higher net revenues, lower financial charges and lower general and administrative expenses. The higher revenues were largely attributable to a 46 percent increase in natural gas production and improvements in crude oil and natural gas liquid prices compared to the third quarter of 1991. Financial charges declined as a result of lower average interest rates.
During the nine months ended Sept. 30, 1992, funds generated from operations were $48.7 million or 31 cents per common share (20 cents per share on a fully diluted basis), an increase of $2.1 million or 1 cent per common share from the same period in 1991. The net loss applicable to common shareholders for the nine-month period amounted to $53.6 million or 34 cents per share compared to a net loss of $64.5 million or 42 cents per share for the corresponding period in 1991. For the first nine months of 1992, net revenues were $192.1 million, down $7.2 million or 4 percent compared to the same period last year. Additional revenues of $20.7 million resulted from higher natural gas production and $7.5 million from higher Canadian conventional oil prices. However, these increases were more than offset by reductions of $14.2 million due to lower hedging revenue, $10.8 million resulting from lower natural gas prices, $5.7 million due to a decline in oil and natural gas liquids volumes and $4.7 million attributable to other price, volume and royalty variances. Expenses increased by $12.6 million from $202.2 million for the nine months ended Sept. 30, 1991 to $214.8 million for the first nine months of 1992. The provision for depletion, depreciation and amortization rose by $22.7 million as a result of an increase in natural gas production, an increase in the depletion and depreciation rate following a downward revision to the company's proved natural gas reserves in the fourth quarter of 1991 and an additional provision for future removal and site restoration costs of $5.1 million. Amortization of undeveloped rights decreased by $5.0 million reflecting a decline in oil and gas leases subject to expiry in 1992. Dry hole and abandonment costs were lower by $4.5 million and, as a result of reduced activity, exploration expenses declined by $3.8 million. Lower average interest rates caused a decline in financial charges of $9.7 million or 23 percent to $32.7 million for the first nine months of 1992 compared to $42.4 million for the same period in 1991. The second quarter disposition of Encor's interest in the Kupe and Toru fields off the west coast of New Zealand for proceeds of $20.8 million accounted for substantially all of the gain on sale of properties of $20.7 million recorded during the nine months ended Sept. 30, 1992. Capital expenditures and exploration expenses for the first nine months of 1992 were cut substantially to $23.9 million, a reduction of 61 percent from the $60.6 million spent during the same period in 1991. In western Canada, spending of $18.4 million was down $29.0 million from 1991 levels. Internationally, capital expenditures and exploration expenses declined from $13.2 million in 1991 to $5.5 million during 1992. The company is continuing its efforts to eliminate the borrowing base deficiency through asset dispositions. At the end of third quarter, the deficiency had been reduced to $99.9 million from $118.0 million at the end of June. On Oct. 27, 1992, Encor received proceeds of $13.3 million (before tax) for a portion of its interest in Italy. Additional proceeds of approximately $44.2 million (before tax) for the remaining Italian interests are expected to be received prior to year end, assuming approval by the Italian government authorities. Total proceeds after tax of an estimated $47.0 million will be used to reduce the borrowing base deficiency. The company is also actively pursuing the sale of a number of its western Canadian properties. Non-binding bids have been received and final offers are expected in mid-November with closings for the transactions targeted for the fourth quarter of 1992 and the first quarter of 1993. The company's shares trade on the Toronto Stock Exchange and the Montreal Exchange under the symbol "ECR." ENCOR INC. Financial Highlights (millions of dollars, except per share amounts) Quarter Ended Nine Months Ended Sept. 30, Sept. 30, 1992 1991 1992 1991 Financial Revenues, net of royalties 67.0 63.0 192.1 199.3 Funds generated from operations 23.7 15.0 48.7 46.6 Per Common share Basic $0.15 $0.10 $0.31 $0.30 Fully diluted $0.09 $0.07 $0.20 $0.20 Net loss 9.1 15.5 42.5 53.9 Provision for redemption premium on convertible preferred shares 3.7 3.6 11.1 10.6 Net loss applicable to common shareholders 12.8 19.1 53.6 64.5 Per common share $0.08 $0.13 $0.34 $0.42 Capital expenditures and exploration expenses 6.5 15.4 23.9 60.6 Operations Average Daily Production Oil and natural gas liquids (Bbls) 31,116 32,464 31,017 33,434 Natural gas (MMcf) 201 138 210 156 Average Prices Oil and natural gas liquids ($/Bbl) 21.33 18.72 19.65 18.60 Natural gas ($/Mcf) 1.27 1.27 1.19 1.38 -0- 11/4/92 /CONTACT: E.R. Bingham, treasurer of Encor, 403-231-1888/ (ECR.) CO: Encor Inc. ST: Alberta IN: OIL SU: ERN
KJ -- LA046 -- 2744 11/04/92 18:36 EST
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|Date:||Nov 4, 1992|
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