Triangle Petroleum Provides Financial Results and Operational Update For All Business Segments For Fourth Quarter and Full Fiscal Year 2015
13.04.2015 | PR Newswire
DENVER, April 13, 2015 /PRNewswire/ -- Triangle Petroleum Corp. ("Triangle" or the "Company") (NYSE MKT: TPLM) today provides an operational update and reports its fourth quarter fiscal year 2015 ("Q4 2015") and full fiscal year 2015 ("FY 2015") results for the period ended January 31, 2015.
Highlights for Fiscal Year 2015
- Increased volumes in FY 2015 to 4,176 Mboe (+116% y/y) as compared to 1,929 Mboe in fiscal year 2014 ("FY 2014"). Average daily production increased to 11,441 Boepd in FY 2015, or 2% above the high end of our FY 2015 guidance range of 10,200-11,200 Boepd, from 5,286 Boepd in FY 2014
- Total capital expenditures amounted to approximately $671.9 million, in line with full year budget guidance
- Increased consolidated adjusted net income in FY 2015 to $54.1 million, or $0.58 per fully diluted EPS (+21% y/y), as compared to $37.4 million, or $0.48 per fully diluted EPS in FY 2014
- Increased total estimated net proved reserves to 58,870 Mboe (61% proved developed) at fiscal year-end 2015, a 46% increase over fiscal year-end 2014 total estimated net proved reserves, with an associated increase in SEC PV-10 to approximately $983 million (+45% y/y)
- Repurchased and retired $20.5 million face value of Triangle USA Petroleum Corporation ("TUSA") outstanding 6.75% bonds for just under $13.9 million
- Repurchased 6.5 million shares of common stock at an average price of $4.94 per share in Q4 2015, bringing cumulative repurchases during FY 2015 to approximately 11.4 million shares at an average price of $6.72 per share leaving a total of approximately 75.2 million shares outstanding at January 31, 2015
- $428.7 million of total liquidity as of January 31, 2015, including $67.9 million of cash on hand and available borrowing capacity on TUSA and RockPile Energy Services ("RockPile") credit facilities
Segment Financial Results
FY 2015 and Q4 2015 stand-alone revenue and Adjusted-EBITDA (reference accompanying "Reconciliation Tables" as well as "Use of Segment Information and Non-GAAP Measures" disclosures at end of press release)
| FY 2015 | Revenue | y/y % Change | Adj.-EBITDA | y/y % Change |
| E&P | $284.5 | 77% | $208.2 | 86% |
| RockPile | $418.1 | 116% | $95.1 | 127% |
| Total | $702.6 | 98% | $303.3 | 97% |
| *Dollars in U.S. millions | |
| *Exploration and production operating segment ("E&P") Adjusted-EBITDA includes all exploration and production related business lines, and does not include TPC (parent company) other revenues and expenses |
| Q4 2015 | Revenue | y/y % Change | Adj.-EBITDA | y/y % Change |
| E&P | $63.0 | 28% | $54.2 | 69% |
| RockPile | $111.1 | 97% | $17.9 | 71% |
| Total | $174.2 | 65% | $72.1 | 70% |
| *Dollars in U.S. millions. Total amounts vary due to rounding | |
| *Exploration and production operating segment ("E&P") Adjusted-EBITDA includes all exploration and production related business lines, and does not include TPC (parent company) other revenues and expenses |
Operational Update
- TUSA generated $284.5 million of revenue in FY 2015 (+77% y/y) as compared to $160.5 of revenue in FY 2014. In Q4 2015, TUSA generated $63.0 million of revenue (+28% y/y) as compared to $49.4 million in Q4 2014
- Increased Q4 2015 volumes to 1,357 Mboe (+103% y/y) from 667 Mboe in Q4 2014. Q4 2015 average daily volumes were 14,747 Boepd as compared to 7,249 Boepd in Q4 2014
- Spud 62 gross (43.9 net) and completed 49 gross (34.5 net) operated wells with a four-rig operated program in FY 2015
- Incurred $435 million of operated and non-operated drilling and completion capex in FY 2015
- Includes a consolidated elimination benefit from RockPile, Caliber Midstream Partners L.P. ("Caliber"), and other services in FY 2015 resulting in an aggregate net reduction of $31.6 million in oil and natural gas property expenditures, which represents an approximate 7% cost savings
- Reduced gross well costs to $10.2 million on average in FY 2015 (-14% y/y) with recent gross well AFEs coming in under $8 million and already exceeding the top end of our 10-20% FY 2016 well cost reduction target
- Decreased drilling time to an average of 16 days in FY 2015 as a result of high grading drilling rig fleet and pad drilling efficiencies
- 84% of approximately 83,000 net core acres held by production as of fiscal year-end 2015
- Incurred $435 million of operated and non-operated drilling and completion capex in FY 2015
- Successful Bakken down spacing program across our core acreage supported an increase in gross operated remaining drilling inventory to 673 locations assuming 8 Bakken (up from 6) and 4 Three Forks wells per drilling spacing unit (DSU); further evaluation and testing of Three Forks down spacing ongoing
- As of January, 31 2015, approximately 90% of operated producing wells were connected to gas sales and 91% were connected to oil gathering infrastructure
- Reduced lease operating expense (LOE) to $6.15/boe (-18% y/y) in FY 2015 from $7.49/boe in FY 2014
- RockPile generated $418.1 million (+116% y/y) of stand-alone revenue in FY 2015 ($288.5 million of consolidated revenue) as compared to $193.6 million in FY 2014 ($98.2 million of consolidated revenue). In Q4 2015, RockPile generated $111.1 million (+97% y/y) of stand-alone revenue as compared to $56.5 million in Q4 2014
- Increased year-over-year completions by 83%, completing 49 Triangle operated wells and 99 third-party wells in FY 2015 as compared to 31 Triangle operated wells and 50 third-party wells in FY 2014
- Backlog of 39 wells, including 37 for third-party operators, at the end of February 2015
- In FY 2015, RockPile paid total distributions of $89 million (95% cash) to Triangle
| Q4 Fiscal Year 2015 and Fiscal Year 2015 Summary Consolidated Statement of Operations (in thousands) | ||||||||||||
| Three Months Ended January 31, | Year Ended January 31, | |||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||
| Revenues | ||||||||||||
| Oil, natural gas and natural gas liquids sales | $ 63,023 | $ 49,372 | $ 284,502 | $ 160,548 | ||||||||
| Oilfield services(a) | 93,965 | $ 36,138 | 288,453 | 98,199 | ||||||||
| Total Revenues | 156,988 | 85,510 | 572,955 | 258,747 | ||||||||
| Expenses | ||||||||||||
| Lease operating expenses | 6,962 | 4,965 | 25,703 | 14,454 | ||||||||
| Gathering, transportation and processing | 6,605 | 2,753 | 18,520 | 4,302 | ||||||||
| Production taxes | 6,112 | 5,482 | 29,774 | 18,006 | ||||||||
| Depreciation and amortization | 43,590 | 21,011 | 124,055 | 58,011 | ||||||||
| Accretion of asset retirement obligations | (157) | (944) | 167 | 56 | ||||||||
| Oilfield services(a) | 74,475 | 29,285 | 216,596 | 82,327 | ||||||||
| Corporate and other stock-based compensation | 1,808 | 1,978 | 6,255 | 6,113 | ||||||||
| E&P stock-based compensation | 323 | 230 | 1,155 | 1,127 | ||||||||
| RockPile stock-based compensation | 146 | 132 | 509 | 590 | ||||||||
| Corporate and other cash G&A expenses | 4,878 | 2,837 | 14,550 | 8,203 | ||||||||
| E&P cash G&A expenses | 3,484 | 1,739 | 13,736 | 7,480 | ||||||||
| RockPile cash G&A expenses | 7,560 | 3,541 | 25,218 | 11,116 | ||||||||
| System conversion costs | - | - | 1,334 | - | ||||||||
| Total operating expenses | 155,786 | 73,009 | 477,572 | 211,785 | ||||||||
| Operating Income | 1,202 | 12,501 | 95,383 | 46,962 | ||||||||
| Interest expense, net | (9,164) | (1,698) | (25,100) | (7,132) | ||||||||
| Amortization of deferrred loan costs | (1,372) | (554) | (3,149) | (554) | ||||||||
| Gain on extinguishment of debt | 6,610 | - | 6,610 | - | ||||||||
| Commodity derivatives gains (losses) | 50,605 | 2,146 | 64,050 | 1,082 | ||||||||
| Equity investment income (loss) | (376) | - | 81 | - | ||||||||
| Gain (loss) on equity investment derivatives | (3,109) | 3,953 | 553 | 39,785 | ||||||||
| Other income | 360 | (126) | 469 | 1,278 | ||||||||
| Total other income | 43,553 | 3,720 | 43,514 | 34,459 | ||||||||
| Net Income Before Income Taxes | 44,755 | 16,221 | 138,897 | 81,421 | ||||||||
| Income tax provision(b) | 5,850 | 1,972 | 45,500 | 7,941 | ||||||||
| Net Income | $ 38,905 | $ 14,249 | $ 93,397 | $ 73,480 | ||||||||
| Net Income per Common Share | ||||||||||||
| Basic | $ 0.50 | $ 0.17 | $ 1.12 | $ 1.07 | ||||||||
| Diluted(c) | $ 0.42 | $ 0.15 | $ 0.97 | $ 0.91 | ||||||||
| Adjusted Net Income per Common Share(d) | ||||||||||||
| Basic | $ 0.06 | $ 0.12 | $ 0.65 | $ 0.55 | ||||||||
| Diluted(c) | $ 0.06 | $ 0.11 | $ 0.58 | $ 0.48 | ||||||||
| Weighted Average Common Shares | ||||||||||||
| Basic | 77,207 | 85,677 | 83,611 | 68,579 | ||||||||
| Diluted | 94,857 | 102,757 | 101,032 | 84,558 | ||||||||
| (a) Includes intercompany eliminations; reference Note 3 – Segment Reporting in our fiscal year 2015 Form 10-K for additional details | ||||||||||||
| (b) The effective tax rate for the three months and year ended January 31, 2015 is approximately 13% and 33%, respectively, which differs from the statutory income tax rate due to permanent book to tax differences. Income tax provision is a non-cash expense | ||||||||||||
| (c) Includes interest expense add-back of $1.0 million and $4.1 million net of income taxes and amounts capitalized for the 3 months and year ended January 31, 2015, respectively, related to outstanding convertible note | ||||||||||||
| (d) Reference accompanying Reconciliation Tables and Use of Segment Information and Non-GAAP Measures at end of press release for additional detail | ||||||||||||
| Use of Segment Information and Non-GAAP Measures | |
| (1) | The Company often provides financial metrics for Triangle's segments of operation. Revenues for each segment are disclosed in notes to the financial statements contained in the Company's Form 10-K and Form 10-Q filings, but the sum of those stand-alone revenues differ from Triangle's consolidated revenues for the corresponding reporting period. Triangle's consolidated revenues would reflect segment revenues reduced for intercompany sales (i.e. for RockPile services to Triangle's E&P segment). |
| Triangle also believes that stand-alone segment revenue assists investors in measuring RockPile's performance as a stand-alone company without eliminating, on a consolidated basis, certain revenues attributable to services for Triangle's economic interests in wells operated by Triangle's E&P segment. | |
| (2) | Adjusted-EBITDA represents income before interest expense, income taxes, depreciation and amortization, other non-cash items, and non-recurring items. Adjusted-EBITDA is not a calculation based upon generally accepted accounting principles in the U.S. ("GAAP"). Triangle has presented Adjusted-EBITDA by segment because it regularly reviews Adjusted-EBITDA by segment as a measure of the segment's operating performance. Triangle also believes Adjusted-EBITDA assists investors in comparing segment performance on a consistent basis without regard to interest expense, income taxes, depreciation and amortization, other non-cash items, and non-recurring items which can vary significantly depending upon many factors. |
| The total of Adjusted-EBITDA by segment is not indicative of Triangle's consolidated Adjusted-EBITDA, which reflects other matters such as (i) additional parent company administrative costs, (ii) intercompany eliminations, (iii) paid-in-kind interest expense on the convertible notes, and (iv) the use of the equity method, rather than consolidation, for Triangle's investment in Caliber. The Adjusted-EBITDA measures presented in the "Reconciliation Tables" may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation. | |
| Triangle believes that net income before income taxes is the performance measure calculated and presented in accordance with GAAP that is most directly comparable to Adjusted-EBITDA. Net income before income taxes will be significantly affected by consolidated interest expense and full-cost pool amortization. Such amortization varies with changes in proved reserves, well costs during the year, and future plans in developing proved undeveloped reserves. | |
| (3) | Adjusted net income (loss) is defined as net income (loss) applicable to common stockholders adjusted to exclude certain charges or amounts in order to provide users of this financial information with additional meaningful comparisons between current results and the results of prior periods. Triangle presents this measure because (i) it is consistent with the manner in which the Company's performance is measured relative to the performance of its peers, (ii) this measure is more comparable to earnings estimates provided by securities analysts, and (iii) charges or amounts excluded cannot be reasonably estimated and guidance provided by the Company excludes information regarding these types of items. These adjusted amounts are not a measure of financial performance under GAAP. We believe that net income (loss) is the performance measure calculated and presented in accordance with GAAP that is most directly comparable to adjusted net income (loss). |
About Triangle
Triangle (NYSE MKT: TPLM) is an independent energy company with a strategic focus on developing the Bakken Shale and Three Forks formations in the Williston Basin of North Dakota and Montana. For more information, visit Triangle's website at www.trianglepetroleum.com.
Conference Call Information
As previously announced, Triangle will host a conference call Tuesday, April 14, 2015 at 8:30 AM MT (10:30 AM ET) to provide an operational update and financial results of Triangle's fourth quarter and full fiscal year 2015, followed immediately by a question and answer session. A live webcast of the conference call can be accessed by visiting the following link: http://www.videonewswire.com/event.asp?id=101935 or interested parties may dial-in using the conference call number (888) 347-6610. International parties may dial-in using (412) 902-4292. A recording of the conference call will be available through April 23, 2015 at (877) 344-7529 (conference # 10062769). For international participants, the replay dial-in number is (412) 317-0088 (conference # 10062769).
| Fiscal Year 2015 Segment Income and Elimination (in thousands) | ||||||||||||||
| Exploration and | Oilfield | Corporate | Eliminations and Other | Consolidated Total | ||||||||||
| Revenues | ||||||||||||||
| Oil, natural gas and natural gas liquids sales | $ | 284,502 | $ | - | $ | - | $ | - | $ | 284,502 | ||||
| Oilfield services for third parties | - | 294,526 | - | (6,073) | 288,453 | |||||||||
| Intersegment revenues | - | 123,577 | - | (123,577) | - | |||||||||
| Total Revenues | 284,502 | 418,103 | - | (129,650) | 572,955 | |||||||||
| Expenses | ||||||||||||||
| LOE, GTP, Production Taxes and other expenses | 74,164 | - | - | - | 74,164 | |||||||||
| Depreciation and amortization | 116,633 | 22,008 | 921 | (15,507) | 124,055 | |||||||||
| Cost of oilfield services | - | 301,142 | 308 | (84,854) | 216,596 | |||||||||
| General and administrative | 16,225 | 25,727 | 20,805 | - | 62,757 | |||||||||
| Total operating expenses | 207,022 | 348,877 | 22,034 | (100,361) | 477,572 | |||||||||
| Operating Income | 77,480 | 69,226 | (22,034) | (29,289) | 95,383 | |||||||||
| Other income (expense), net | 51,216 | (3,024) | (2,356) | (2,322) | 43,514 | |||||||||
| Net Income (Loss) Before Income Taxes | $ | 128,696 | $ | 66,202 | $ | (24,390) | $ | (31,611) | (b) | $ | 138,897 | |||
| (a) Corporate and Other includes Triangle's corporate office and several subsidiaries that management does not consider to be part of the exploration and production or oilfield services segments. Also included are results from Triangle's investment in Caliber, including any changes in the fair value of equity investment derivatives. Other than Caliber, these subsidiaries have limited activity |
| (b) $31.6 million RockPile, Caliber, and other services consolidated elimination results in a $31.6 million reduction in oil and natural gas property expenditures. |
| *Reference Note 3 – Segment Reporting in our fiscal year 2015 Form 10-K for additional details |
| Q4 Fiscal Year 2015 Segment Income and Elimination (in thousands)
| ||||||||||||||
| Exploration and Production | Oilfield Services | Corporate and Other(a) | Eliminations and Other | Consolidated Total | ||||||||||
| Revenues | ||||||||||||||
| Oil, natural gas and natural gas liquids sales | $ | 63,023 | $ | - | $ | - | $ | - | $ | 63,023 | ||||
| Oilfield services for third parties | - | 94,066 | - | (101) | 93,965 | |||||||||
| Intersegment revenues | - | 17,075 | - | (17,075) | - | |||||||||
| Total Revenues | 63,023 | 111,141 | - | (17,176) | 156,988 | |||||||||
| Expenses | ||||||||||||||
| LOE, GTP, Production Taxes and other expenses | 19,522 | - | - | - | 19,522 | |||||||||
| Depreciation and amortization | 39,903 | 7,608 | 304 | (4,225) | 43,590 | |||||||||
| Cost of oilfield services | - | 86,015 | 256 | (11,796) | 74,475 | |||||||||
| General and administrative | 3,807 | 7,706 | 6,686 | - | 18,199 | |||||||||
| Total operating expenses | 63,232 | 101,329 | 7,246 | (16,021) | 155,786 | |||||||||
| Operating Income | (209) | 9,812 | (7,246) | (1,155) | 1,202 | |||||||||
| Other income (expense), net | 49,789 | (1,489) | (4,619) | (128) | 43,553 | |||||||||
| Net Income (Loss) Before Income Taxes | $ | 49,580 | $ | 8,323 | $ | (11,865) | $ | (1,283) | (b) | $ | 44,755 | |||
| (a) Corporate and Other includes Triangle's corporate office and several subsidiaries that management does not consider to be part of the exploration and production or oilfield services segments. Also included are results from Triangle's investment in Caliber, including any changes in the fair value of equity investment derivatives. Other than Caliber, these subsidiaries have limited activity
(b) $1.3 million RockPile, Caliber, and other services consolidated elimination results in a $1.3 million reduction in oil and natural gas property expenditures.
*Reference Note 3 – Segment Reporting in our fiscal year 2015 Form 10-K for additional details |
| Reconciliation Tables (in thousands)
| |
| a) | Consolidated Adjusted net income (loss) per common stockholder (reference disclosure (3) in "Use of Segment Information and Non-GAAP Measures") |
| Q4 Fiscal 2015 | Q4 Fiscal 2014 | Fiscal 2015 | Fiscal 2014 | |||||||||
| Net income attributable to common stockholders | $ 38,905 | $ 14,249 | $ 93,397 | $ 73,480 | ||||||||
| (Gain) loss on equity investment derivatives | 3,109 | (3,953) | (553) | (39,785) | ||||||||
| (Gain) loss on commodity derivatives | (50,605) | (2,146) | (64,050) | (1,082) | ||||||||
| Realized gain (loss) on commodity derivatives | 14,506 | - | 11,422 | - | ||||||||
| Other | (6,610) | 1,972 | (5,276) | 932 | ||||||||
| Tax impact(a) | 5,176 | 502 | 19,149 | 3,895 | ||||||||
| Adjusted Net Income | $ 4,481 | $ 10,624 | $ 54,090 | $ 37,439 | ||||||||
| Adjusted Net Income Per Common Share | ||||||||||||
| Basic | $ 0.06 | $ 0.12 | $ 0.65 | $ 0.55 | ||||||||
| Diluted(b) | $ 0.06 | $ 0.11 | $ 0.58 | $ 0.48 | ||||||||
| Weighted Average Common Shares | ||||||||||||
| Basic | 77,207 | 85,677 | 83,611 | 68,579 | ||||||||
| Diluted | 94,857 | 102,757 | 101,032 | 84,558 | ||||||||
| (a) Tax impact is computed as pre tax-effected adjusting items multiplied by the Company's effective tax rate
(b) Includes interest expense add-back of $1.0 million and $4.1 million net of income taxes and amounts capitalized for the 3 months and year ended January 31, 2015, respectively, related to outstanding convertible note |
| b) | E&P stand-alone Adjusted-EBITDA (reference disclosure (1) and (2) in "Use of Segment Information and Non-GAAP Measures") |
| Q4 Fiscal 2015 | Fiscal 2015 | |||||||
| Net Income (Loss) Before Income Taxes | $ 49,580 | $ 128,696 | ||||||
| Depreciation and amortization | 39,903 | 116,633 | ||||||
| Net interest expense | 7,730 | 19,574 | ||||||
| Stock-based compensation | 323 | 1,155 | ||||||
| Accretion of asset retirement obligations | (157) | 167 | ||||||
| Other | (7,049) | (5,406) | ||||||
| (Gain) loss on commodity derivatives | (50,605) | (64,050) | ||||||
| Realized gain (loss) on commodity derivatives | 14,506 | 11,422 | ||||||
| Adjusted-EBITDA | $ 54,231 | $ 208,191 | ||||||
| c) | Oilfield Services stand-alone Adjusted-EBITDA (reference disclosure (1) and (2) in "Use of Segment Information and Non-GAAP Measures") |
| Q4 Fiscal 2015 | Fiscal 2015 | ||||||
| Net Income (Loss) Before Income Taxes | $ 8,323 | $ 66,202 | |||||
| Depreciation and amortization | 7,608 | 22,008 | |||||
| Stock-based compensation | 146 | 509 | |||||
| Net interest expense | 1,061 | 2,704 | |||||
| Other | 776 | 3,720 | |||||
| Adjusted-EBITDA | $ 17,914 | $ 95,143 | |||||
| *Oilfield Services Adjusted-EBITDA calculated per RockPile credit facility |
Forward-Looking Statements Disclosure
The information presented in this press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from the results contemplated by the forward-looking statements. Factors that could cause actual results to differ materially from the results contemplated by the forward-looking statements include, but are not limited to, the risks discussed in the Company's annual report on Form 10-K and its other filings with the Securities and Exchange Commission. The forward-looking statements in this press release are made as of the date of this press release, and the Company undertakes no obligation to update any forward-looking statement as a result of new information, future developments, or otherwise.
Contact
Triangle Petroleum Corp.
Joe Magner, Vice President, Capital Markets
303-260-7125
info@trianglepetroleum.com
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SOURCE Triangle Petroleum Corp.