Kolibri Global Energy Announces Annual 2022 Net Income of US$16.7 Million and Adjusted EBITDA of $25.1 Million
Kolibri Global Energy reported remarkable financial growth for 2022, with Adjusted EBITDA soaring to $25.1 million, a 282% increase compared to $6.6 million in 2021. Net revenues reached $37.6 million, up 151% from the previous year, driven by a 68% increase in production and a 50% rise in average prices. Despite a net income drop to $16.6 million from $71 million, excluding a one-time impairment reversal in 2021, net income increased significantly. The average production was 1,640 BOEPD, with a year-end exit rate exceeding 4,000 BOEPD. Management forecasts a strong 2023 with capital expenditures projected between $44 million to $51 million.
- Adjusted EBITDA increased 282% to $25.1 million in 2022.
- Net revenues rose 151% to $37.6 million.
- Average production increased 68% to 1,640 BOEPD.
- Year-end production exit rate exceeded 4,000 BOEPD.
- 43% increase in total proved reserves value to $514.8 million.
- Net income dropped to $16.6 million from $71 million in 2021.
- Higher realized losses from commodity contracts impacted revenue.
2022 HIGHLIGHTS
-
Adjusted EBITDA(1) was
in 2022 compared to$25.1 million in 2021, an increase of$6.6 million 282% . This increase was due to the increase in production of68% and the increase in average prices of50% partially offset by higher realized losses from commodity contracts. This exceeded management’s forecasted guidance of Adjusted EBITDA (formerly referred to as Adjusted Funds Flow) of to$23 $25 million -
Net revenues for 2022 were
, an increase of$37.6 million 151% compared to 2021. This also exceeded management’s forecasted guidance of to$35 million . This increase was primarily due to a$37 million 68% increase in production and a50% increase in average prices in 2022 compared to 2021 -
Net income in 2022 was
compared to net income of$16.6 million in 2021. The Company recorded an impairment reversal of$71.0 million for the year ended$70.8 million December 31, 2021 . Excluding the impact of that impairment reversal, net income in 2022 increased by over 2021 due to higher production and higher average prices partially offset by higher realized losses on commodity contracts$16.5 million -
Average production for 2022 was 1,640 BOEPD, an increase of
68% compared to 2021 production of 975 BOEPD. This was in the range of management’s forecasted guidance of 1,500 to 1,700 BOEPD. The increase is mainly due to production from the Barnes 7-3H well and the Barnes 8-4H well which started producing in the second quarter of 2022. The Emery 17-2H well (99% working interest) started production in lateNovember 2022 , the Brock 9-3H well (100% working interest) produced for twenty days inDecember 2022 and the Glenn 16-3H well (100% working interest) produced for twelve days inDecember 2022 -
The production exit rate as of
December 31, 2022 was over 4,000 BOEPD which exceeded management’s forecasted guidance of 2,700 BOEPD -
Netback from operations(2) increased to
per BOE in 2022 compared to$54.56 per BOE in 2021, an increase of$33.75 62% . Netback including commodity contracts(2) for 2022 was per BOE compared to$47.79 in 2021, an increase of$26.05 83% from the prior year. The 2022 increase compared to the prior year was due to the increase in average prices partially offset by higher production taxes -
The Company’s NPV10 of Total Proved Reserves were
for 2022, which was a$514.8 million 43% increase from 2021 according to the Company’sDecember 31, 2022 , independent reserves evaluation, due primarily to higher type curves and higher estimated future pricing -
Production and operating expense per barrel averaged
per BOE in 2022 compared to$8.19 per BOE in 2021, a decrease of$8.32 2% . The decrease was due to increased production which reduced the per barrel fixed costs partially offset by higher production taxes due to an increase in prices as well as higher service and material costs -
The net debt of the Company at
December 31, 2022 was which was in the range of management’s forecasted guidance of$16.8 million to 17 million$15 -
The ratio of debt to Adjusted EBITDA was 0.83 at
December 31, 2022 which met management’s forecasted guidance of less than 1.0 -
In
October 2022 , the credit facility was redetermined and the borrowing base was increased from to$20 million . As at$25 million December 31, 2022 , the Company has of available borrowing capacity on the credit facility$6.8 million
(1) |
|
Adjusted EBITDA is considered a non-GAAP measure. Refer to the section entitled “Non-GAAP Measures” of this earnings release. |
(2) |
|
Netback from operations and netback including commodity contracts are considered non-GAAP ratios. Refer to the section entitled “Non-GAAP Measures” of this earnings release. |
Kolibri’s President and Chief Executive Officer,
“We are extremely pleased with the transformation of the Company that occurred in 2022. We were able to increase our Adjusted EBITDA by
“Looking ahead, we are currently forecasting the 2023 drilling program to deliver as follows:
-
Capital expenditures of
to$44 million to drill between six and seven wells throughout the year with timing to be determined based on available cash flow. We plan to fund our 2023 drilling program with our existing cash flow, with the potential of temporarily drawing down a portion of our outstanding credit facility to manage working capital;$51 million -
Annual average production of between 3,600 to 4,000 BOEPD with a year-end exit rate of between 4,500 to 5,000 BOEPD, based on the assumption that the new production performs per a type curve which is similar to NSAI’s
December 2022 proved type curve; -
Generate between
to$65 million in net revenue and$70 million to$52 million of adjusted EBITDA(3); and$55 million -
Net debt at year-end between
to$16.0 million while maintaining a total debt to EBITDA ratio of less than 1.0 throughout the year(3)$18.0 million - Management plans to reevaluate the 2023 drilling program later in the year and may modify it once we have more visibility on prices and well performance. Any modifications to the drilling program may affect the above forecast.
(3) |
|
Assumptions include forecasted pricing of WTI US |
“Adjusted EBITDA(1) was
“The average production for 2022 was 1,640 BOEPD, an increase of
“Net revenues for 2022 were
“Net income in 2022 was
“Netback from operations(2) increased to
“Production and operating expense per barrel averaged
“Our 2022 independent reserves evaluation report showed a
Fourth Quarter |
|
Year Ended |
|
|||
2022 |
2021 |
% |
2022 |
2021 |
% |
|
|
|
|
|
|
|
|
Net Income (Loss): |
|
|
|
|
|
|
$ Thousands |
|
|
( |
|
|
( |
$ per basic common share |
|
|
( |
|
|
( |
|
|
|
|
|
|
|
Adjusted EBITDA(1) |
|
|
|
|
|
|
Capital Expenditures |
|
|
2, |
|
|
5, |
|
|
|
|
|
|
|
Average Production (Boepd) |
1,868 |
931 |
|
1,640 |
975 |
|
Gross Revenue |
12,455 |
5,444 |
|
48,376 |
19,128 |
|
Average Price per Barrel |
|
|
|
|
|
|
Netback from operations per Barrel(2) |
|
|
|
|
|
|
Netback including commodity contracts per Barrel(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 2022 |
|
December 2021 |
|
|
|
Cash and Cash Equivalents |
|
|
|
|
|
|
Working Capital |
|
|
|
|
|
|
(4) |
|
Includes |
Year Ended 2022 to Year Ended 2021
For 2022, oil and gas gross revenues increased
Average production for 2022 was 1,640 BOEPD, an increase of
Production and operating expenses increased by
Depletion and depreciation expense increased
General and administrative expenses increased
Finance income increased by
Finance expense decreased
FOURTH QUARTER HIGHLIGHTS:
-
Adjusted EBITDA(1) was
in the fourth quarter of 2022 compared to$6.9 million in 2021, an increase of$1.9 million 268% . This increase was due to the increase in production and the increase in average prices -
Net revenues for the fourth quarter of 2022 were
, an increase of$9.7 million 129% , compared to the fourth quarter of 2021. This increase was primarily due to an increase in production and average prices -
Net income in the fourth quarter of 2022 was
, compared to net income of$2.8 million in the fourth quarter of 2021. The Company recorded an impairment reversal of$72.3 million in the fourth quarter of 2021$70.8 million -
Average production for the fourth quarter of 2022 was 1,868 BOEPD, an increase of
101% compared to fourth quarter 2021 production of 975 BOEPD. The increase is due to production from the five new wells drilled in 2022. -
Netback from operations(2) increased to
per BOE in the fourth quarter of 2022 compared to$48.39 per BOE in the fourth quarter of 2021, an increase of$40.88 18% . Netback including commodity contracts(2) for the fourth quarter of 2022 was per BOE compared to$46.05 in the fourth quarter of 2021, an increase of$28.99 59% from the prior year quarter. The 2022 increase compared to the prior year was due to the increase in average prices partially offset by higher production taxes -
Production and operating expense per barrel averaged
per BOE in the fourth quarter of 2022 compared to$8.25 per BOE in the fourth quarter of 2021, a decrease of$8.79 6% . The decrease was due to increased production which reduced the per barrel fixed costs partially offset by higher production taxes due to an increase in prices
Fourth Quarter 2022 to Fourth Quarter 2021
Gross oil and gas revenues totaled
Operating expenses increased by
G&A expenses increased by
Finance income decreased by
Finance expense increased
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited, Expressed in Thousands of United States Dollars) |
|||||||
|
|
|
|
|
|||
|
|
2022 |
|
2021 |
|||
Current assets |
|
|
|
|
|||
Cash and cash equivalents |
$ |
1,037 |
|
$ |
7,316 |
|
|
Trade and other receivables |
|
5,773 |
|
|
1,999 |
|
|
Deposits and prepaid expenses |
|
670 |
|
|
587 |
|
|
|
|
7,480 |
|
|
9,902 |
|
|
|
|
|
|
|
|||
Non-current assets |
|
|
|
|
|||
Property, plant and equipment |
|
176,554 |
|
|
147,076 |
|
|
Right of use assets |
|
48 |
|
|
38 |
|
|
|
|
|
|
|
|||
Total assets |
$ |
184,082 |
|
$ |
157,016 |
|
|
|
|
|
|
|
|||
Current liabilities |
|
|
|
|
|||
Trade and other payables |
$ |
12,596 |
|
$ |
3,145 |
|
|
Current portion of loans and borrowings |
|
- |
|
|
1,000 |
|
|
Current lease payable |
|
32 |
|
|
43 |
|
|
Fair value of commodity contracts |
|
1,421 |
|
|
1,891 |
|
|
|
|
14,049 |
|
|
6,079 |
|
|
|
|
|
|
|
|||
Non-current liabilities |
|
|
|
|
|||
Loans and borrowings |
|
17,799 |
|
|
15,866 |
|
|
Asset retirement obligations |
|
1,425 |
|
|
1,398 |
|
|
Lease payable |
|
17 |
|
|
- |
|
|
Fair value of commodity contracts |
|
594 |
|
|
585 |
|
|
|
|
19,835 |
|
|
17,849 |
|
|
|
|
|
|
|
|||
Equity |
|
|
|
|
|||
Share capital |
|
296,221 |
|
|
296,060 |
|
|
Contributed surplus |
|
23,254 |
|
|
22,948 |
|
|
Deficit |
|
(169,277 |
) |
|
(185,920 |
) |
|
Total equity |
|
150,198 |
|
|
133,088 |
|
|
|
|
|
|
|
|||
Total equity and liabilities |
$ |
184,082 |
|
$ |
157,016 |
|
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited, expressed in Thousands of |
|||||||||||||||
|
|
|
|
|
|
||||||||||
|
|
Three months ended
|
|
Year ended
|
|||||||||||
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
||||
Revenue: |
|
|
|
|
|
|
|
|
|||||||
Oil and natural gas revenue, net |
$ |
9,734 |
|
$ |
4,255 |
|
$ |
37,560 |
|
$ |
14,972 |
|
|||
Other income |
|
1 |
|
|
- |
|
|
46 |
|
|
2 |
|
|||
|
|
9,735 |
|
|
4,255 |
|
|
37,606 |
|
|
14,974 |
|
|||
Expenses: |
|
|
|
|
|
|
|
|
|||||||
Production and operating |
|
1,417 |
|
|
753 |
|
|
4,904 |
|
|
2,962 |
|
|||
Depletion and depreciation |
|
2,495 |
|
|
915 |
|
|
7,581 |
|
|
3,594 |
|
|||
General and administrative |
|
1,059 |
|
|
622 |
|
|
3,494 |
|
|
2,697 |
|
|||
Share based compensation |
|
45 |
|
|
- |
|
|
277 |
|
|
- |
|
|||
Impairment (impairment reversal) of PP&E |
|
- |
|
|
(70,820 |
) |
|
- |
|
|
(70,820 |
) |
|||
Gain on forgiven loans |
|
- |
|
|
(280 |
) |
|
- |
|
|
(583 |
) |
|||
|
|
5,016 |
|
|
(68,810 |
) |
|
16,256 |
|
|
(62,150 |
) |
|||
|
|
|
|
|
|
|
|
|
|||||||
Finance income |
|
- |
|
|
514 |
|
|
464 |
|
|
- |
|
|||
Finance expense |
|
(1,926 |
) |
|
(1,239 |
) |
|
(5,171 |
) |
|
(6,122 |
) |
|||
|
|
|
|
|
|
|
|
|
|||||||
Net income and comprehensive income |
$ |
2,793 |
|
$ |
72,340 |
|
$ |
16,643 |
|
$ |
71,002 |
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Net income per share |
|
|
|
|
|
|
|
|
|||||||
Basic |
$ |
0.08 |
|
$ |
3.11 |
|
$ |
0.47 |
|
$ |
3.05 |
|
|||
FOURTH QUARTER AND YEAR ENDED 2022
(Unaudited, expressed in Thousands of |
|||||||||
|
|||||||||
4th Quarter |
Year Ended |
||||||||
|
|
2022 |
2021 |
2022 |
2021 |
||||
Oil revenue before royalties |
$ |
11,478 |
4,450 |
42,795 |
15,978 |
||||
Gas revenue before royalties |
|
598 |
|
417 |
|
2,759 |
|
1,259 |
|
NGL revenue before royalties |
|
379 |
|
577 |
|
2,822 |
|
1,891 |
|
|
|
12,455 |
|
5,444 |
|
48,376 |
|
19,128 |
|
|
|
|
|
|
|
||||
Adjusted funds flow |
6,854 |
|
1,859 |
|
25,112 |
|
6,569 |
|
|
Additions to PP&E |
17,184 |
|
559 |
|
37,097 |
|
696 |
|
Statistics: |
4th Quarter |
Year Ended |
||||||
|
2022 |
2021 |
2022 |
2021 |
||||
Average oil production (Bopd) |
1,551 |
|
638 |
|
1,241 |
|
662 |
|
Average natural gas production (mcf/d) |
969 |
|
825 |
|
1,061 |
|
864 |
|
Average NGL production (Boepd) |
155 |
|
153 |
|
222 |
|
169 |
|
Average production (Boepd) |
1,868 |
|
1,082 |
|
1,640 |
|
975 |
|
Average oil price ($/bbl) |
|
|
|
|
|
|
|
|
Average natural gas price ($/mcf) |
|
|
|
|
|
|
|
|
Average NGL price ($/bbl) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Average price per barrel |
|
|
|
|
|
|
|
|
Royalties per barrel |
15.83 |
|
13.89 |
|
18.07 |
|
11.68 |
|
Operating expenses per barrel |
8.25 |
|
8.79 |
|
8.19 |
|
8.32 |
|
Netback from operations(2) |
|
|
|
|
|
|
|
|
Price adjustment from commodity contracts (Boe) |
(2.34 |
) |
(11.89 |
) |
(6.77 |
) |
(7.70 |
) |
Netback including commodity contracts (Boe)(2) |
46.05 |
|
28.99 |
|
47.79 |
|
26.05 |
|
The information outlined above is extracted from and should be read in conjunction with the Company's audited financial statements for the year ended
NON-GAAP MEASURES
Netback from operations, netback including commodity contracts and adjusted EBITDA (collectively, the "Company’s Non-GAAP Measures") are not measures or ratios recognized under Canadian generally accepted accounting principles ("GAAP") and do not have any standardized meanings prescribed by IFRS. Management of the Company believes that such measures and ratios are relevant for evaluating returns on each of the Company's projects as well as the performance of the enterprise as a whole. The Company's Non-GAAP Measures may differ from similar computations as reported by other similar organizations and, accordingly, may not be comparable to similar non-GAAP measures and ratios as reported by such organizations. The Company’s Non-GAAP Measures should not be construed as alternatives to net income, cash flows related to operating activities, working capital or other financial measures and ratios determined in accordance with IFRS, as an indicator of the Company's performance.
An explanation of how the Company’s Non-GAAP Measures provide useful information to an investor and the purposes for which the Company’s management uses the Non-GAAP Measures is set out in the management's discussion and analysis under the heading “Non-GAAP Measures” which is available under the Company's profile at www.sedar.com and is incorporated by reference into this earnings release.
The following is the reconciliation of the non-GAAP ratio netback from operations to net income (loss) from continuing operations, which the Company considers to be the most directly comparable financial measure that is disclosed in the Company’s financial statements:
(US |
Year ended |
|||
2022 |
2021 |
|||
Net income |
16,643 |
|
71,002 |
|
Adjustments: |
||||
Finance income |
(464 |
) |
- |
|
Finance expense |
5,171 |
|
6,122 |
|
Stock based compensation |
277 |
|
- |
|
General and administrative expenses |
3,494 |
|
2,697 |
|
Impairment reversal of property, plant and equipment |
- |
|
(70,820 |
) |
Depletion, depreciation and amortization |
7,581 |
|
3,594 |
|
Other income |
(46 |
) |
(583 |
) |
Operating netback |
32,656 |
|
12,012 |
|
Netback from operations |
|
|
|
|
The following is the reconciliation of the non-GAAP measure adjusted EBITDA to the comparable financial measures disclosed in the Company’s financial statements:
(US |
Year Ended |
|||
|
2022 |
2021 |
||
Net income |
16,643 |
|
71,002 |
|
Depletion and depreciation |
7,581 |
|
3,594 |
|
Accretion |
34 |
|
26 |
|
Interest expense |
1,070 |
|
906 |
|
Unrealized (gain) loss on commodity contracts |
(461 |
) |
2,439 |
|
Share based compensation |
277 |
|
- |
|
Interest income |
(3 |
) |
- |
|
Impairment reversal |
- |
|
(70,820 |
) |
Other income |
(46 |
) |
(585 |
) |
Foreign currency (gain) loss |
17 |
|
10 |
|
Adjusted EBITDA |
25,112 |
|
6,572 |
|
CAUTIONARY STATEMENTS
In this news release and the Company’s other public disclosure:
(a) |
|
The Company's natural gas production is reported in thousands of cubic feet ("Mcfs"). The Company also uses references to barrels ("Bbls") and barrels of oil equivalent ("Boes") to reflect natural gas liquids and oil production and sales. Boes may be misleading, particularly if used in isolation. A Boe conversion ratio of 6 Mcf:1 Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value. |
||
(b) |
|
Discounted and undiscounted net present value of future net revenues attributable to reserves do not represent fair market value. |
||
(c) |
|
Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a |
||
(d) |
|
The Company discloses peak and 30-day initial production rates and other short-term production rates. Readers are cautioned that such production rates are preliminary in nature and are not necessarily indicative of long-term performance or of ultimate recovery. |
Readers are referred to the full description of the results of the Company's
Caution Regarding Forward-Looking Information
This release contains forward-looking information including estimates of reserves, the proposed timing and expected results of exploratory and development work including fracture stimulation and production from the Company's
Such forward-looking information is based on management’s expectations and assumptions, including that the Company's geologic and reservoir models and analysis will be validated, that indications of early results are reasonably accurate predictors of the prospectiveness of the shale intervals, that previous exploration results are indicative of future results and success, that expected production from future wells can be achieved as modeled, declines will match the modeling, future well production rates will be improved over existing wells, that rates of return as modeled can be achieved, that recoveries are consistent with management’s expectations, including that new production will perform per a type curve which is similar to NSAI’s
Forward-looking information involves significant known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks include, but are not limited to: any of the assumptions on which such forward-looking information is based vary or prove to be invalid, including that the Company’s geologic and reservoir models or analysis are not validated, anticipated results and estimated costs will not be consistent with management's expectations, the risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production; delays or changes in plans with respect to exploration and development projects or capital expenditures; the uncertainty of reserve and resource estimates and projections relating to production, costs and expenses, and health, safety and environmental risks including flooding and extended interruptions due to inclement or hazardous weather), the risk of commodity price and foreign exchange rate fluctuations, risks and uncertainties associated with securing the necessary regulatory approvals and financing to proceed with continued development of the Tishomingo Field, the Company or its subsidiaries is not able for any reason to obtain and provide the information necessary to secure required approvals or that required regulatory approvals are otherwise not available when required, that unexpected geological results are encountered, that completion techniques require further optimization, that production rates do not match the Company’s assumptions, that very low or no production rates are achieved, that the price of oil will decline, that the Company will cease to be in compliance with the covenants under its reserves-based loan facility and be required to repay outstanding amounts or that the borrowing base will be reduced pursuant to a borrowing base re-determination and the Company will be required to repay the resulting shortfall, that the Company is unable to access required capital, that funding is not available from the Company’s reserves based loan facility at the times or in the amounts required for planned operations, that occurrences such as those that are assumed will not occur, do in fact occur, and those conditions that are assumed will continue or improve, do not continue or improve and the other risks identified in the Company’s most recent Annual Information Form under the “Risk Factors” section, the Company’s most recent management's discussion and analysis and the Company’s other public disclosure, available under the Company’s profile on SEDAR at www.sedar.com.
With respect to estimated reserves, the evaluation of the Company’s reserves is based on a limited number of wells with limited production history and includes a number of assumptions relating to factors such as availability of capital to fund required infrastructure, commodity prices, production performance of the wells drilled, successful drilling of infill wells, the assumed effects of regulation by government agencies and future capital and operating costs. All of these estimates will vary from actual results. Estimates of the recoverable oil and natural gas reserves attributable to any particular group of properties, classifications of such reserves based on risk of recovery and estimates of future net revenues expected therefrom, may vary. The Company's actual production, revenues, taxes, development and operating expenditures with respect to its reserves will vary from such estimates, and such variances could be material. In addition to the foregoing, other significant factors or uncertainties that may affect either the Company’s reserves or the future net revenue associated with such reserves include material changes to existing taxation or royalty rates and/or regulations, and changes to environmental laws and regulations.
Although the Company has attempted to take into account important factors that could cause actual costs or results to differ materially, there may be other factors that cause actual results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. The forward-looking information included in this release is expressly qualified in its entirety by this cautionary statement. Accordingly, readers should not place undue reliance on forward-looking information. The Company undertakes no obligation to update these forward-looking statements, other than as required by applicable law.
About
View source version on businesswire.com: https://www.businesswire.com/news/home/20230315005941/en/
For further information, contact:
Email: investorrelations@kolibrienergy.com
Website: www.kolibrienergy.com
Source:
FAQ
What were Kolibri Global Energy's adjusted EBITDA figures for 2022?
How much did net revenues increase for Kolibri Global Energy in 2022?
What was the average production for Kolibri Global Energy in 2022?
What does Kolibri Global Energy forecast for production in 2023?