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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Edge Res | LSE:EDG | London | Ordinary Share | CA27986R1010 | COM SHS NPV (DI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.175 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
TIDMEDG
RNS Number : 7767X
Edge Resources Inc.
02 September 2015
FOR IMMEDIATE RELEASE TSX Venture Exchange Symbol: EDE 2 September 2015 AIM Exchange Symbol: EDG Calgary, Alberta EDGE RESOURCES INC.
Edge Resources Inc. Announces Results for the Three Month Period ended June 30, 2015
Edge Resources Inc. ("Edge" or the "Company"), is pleased to announce its audited results for the three month period ended 30 June 2015 ("Q1"), highlights of which are set out below.
Highlights for the period:
-- Sales volumes were 446 boe/d compared to 612 boe/d in the fourth quarter of fiscal 2015 and 613 boe/d in the first quarter of fiscal 2015; the decrease from the prior quarter is due primarily to operational issues experienced during the quarter in Eye Hill, most of which have been remedied subsequent to period end.
-- Due to continued low commodity prices and lower production volumes, cash flows continued to decline.
-- Average achieved oil prices increased 35% to $46.21 for the three months to 30 June 2015 and average achieved natural gas prices increased from $2.51/mcf to $2.64 for the equivalent periods.
Brad Nichol, President and CEO of Edge, commented, "There is no denying it has been a difficult year for all oil and gas operators, big and small. Within the context of a tumultuous industry dynamic, Edge has acted very conservatively with respect to capital expenditures and cost management, and will continue to do so while commodity prices remain low and/or unstable. Notwithstanding the above, we are eager to work with our new capital partner to take advantage of this industry downturn through what is expected to be a favorable and active acquisition market." Nichol added, "In the midst of falling WTI oil prices, Edge's received heavy oil price has had some reprieve, as the "heavy oil discount" to WTI has dramatically improved during the same period. Additionally, the Canadian dollar has weakened versus the US dollar during this time resulting in a lower oil pricing impact for Canadian producers. Both of these factors have lessened the impact of falling light oil prices on Canadian heavy oil producers."
SUMMARY OF THE QUARTERLY RESULTS:
Hot Features
Premium
Three months ended
June 30, June 30,
Note 2015 2014
Revenue
Oil and natural gas sales $ 1,545,895 $ 3,474,391
Royalties (239,214) (669,966)
----------------------------------------------------- ----------- ------------
Revenue, net of royalties 1,306,681 2,804,425
----------------------------------------------------- ----------- ------------
Other income (losses)
Realized loss on financial derivatives (82,591) (198,093)
Unrealized (loss) gain on financial
derivatives (219,211) 161,981
Total income, before expenses 1,004,879 2,768,313
----------------------------------------------------- ----------- ------------
Expenses
Operating 628,043 906,666
Transportation 71,194 111,116
General and administrative 382,873 458,334
Depletion and depreciation 350,100 513,700
Stock-based compensation 41,515 114,686
Finance 313,253 335,626
Capital taxes 17,501 39,754
----------------------------------------------------- ----------- ------------
Total expenses 1,804,479 2,479,882
----------------------------------------------------- ----------- ------------
Income (loss) and comprehensive
income (loss) for the period $ (799,600) $ 288,431
----------------------------------------------------- ----------- ------------
Income (loss) and comprehensive
income (loss) per share
Basic and diluted $ (0.00) $ 0.00
----------------------------------------------------- ----------- ------------
Detailed operating and financial results are presented in Edge's financial statements and related Management Discussion & Analysis ("MD&A"), which can be accessed on the Company's website (www.edgeres.com) and on SEDAR (www.sedar.com).
For more information, visit the company website: www.edgeres.com or contact:
Brad Nichol, President and CEO Phone: +1 403 767 9905
Sanlam Securities UK Limited (Joint Broker and NOMAD) Phone: +44 20 7628 2200
Simon Clements / James Thomas / Max Bascombe
SP Angel Corporate Finance LLP (Joint Broker) Phone: +44 20 3463 2260
John MacKay / Richard Hail
About Edge Resources Inc.
Edge Resources is focused on developing a balanced portfolio of oil and natural gas assets from properties in Alberta and Saskatchewan, Canada. Management has consistently focused on:
1. Shallow, vertical, conventional programs with reduced capital, operational and geological risks
2. Very high or 100% working interests and fully operated assets 3. Pools and horizons with exceptionally high reserves in place
The management team's very high drilling success rate is based on the safe, efficient deployment of capital and a proven ability to efficiently execute in shallow formations, which gives Edge Resources a sustainable, low-cost, competitive advantage.
Edge Resources Inc.
Condensed Interim Balance Sheet
(amounts in Canadian dollars)
March
June 30, 31,
Note 2015 2015
Assets
Current assets
Accounts receivable 3 $ 700,876 $ 836,329
Deposits and prepaid expenses 128,512 78,259
Total current assets 829,388 914,588
------------------------------------ ----- ------------- -------------
Non-current assets
Exploration and evaluation
assets 74,061 74,061
Property, plant and equipment 4 29,468,375 30,502,797
------------------------------------ ----- ------------- -------------
Total non-current assets 29,542,436 30,576,858
------------------------------------ ----- ------------- -------------
Total assets $ 30,371,824 $ 31,491,446
------------------------------------ ----- ------------- -------------
Liabilities
Current liabilities
Bank overdraft $ 230,803 $ 26,367
Accounts payable and accrued
liabilities 1,325,795 2,191,432
Bank debt 5 7,290,000 6,420,000
Fair value of derivative
instruments 104,939 -
Total current liabilities 8,951,537 8,637,799
Loans payable 6 10,843,069 10,643,616
Fair value of derivative
instruments 114,272 -
Decommissioning provisions 7,962,000 8,951,000
------------------------------------ ----- ------------- -------------
Total liabilities 27,870,878 28,232,415
------------------------------------ ----- ------------- -------------
Shareholders' Equity
Share capital 7 36,111,048 36,111,048
Contributed surplus 2,743,450 2,701,935
Deficit (36,353,552) (35,553,952)
------------------------------------ ----- ------------- -------------
Total shareholders' equity 2,500,946 3,259,031
------------------------------------ ----- ------------- -------------
Total liabilities and shareholders'
equity $ 30,371,824 $ 31,491,446
------------------------------------ ----- ------------- -------------
Condensed Interim Statement of Income (Loss) and Comprehensive Income (Loss)
(amounts in Canadian dollars)
Three months ended
June 30, June 30,
Note 2015 2014
Revenue
Oil and natural gas sales $ 1,545,895 $ 3,474,391
Royalties (239,214) (669,966)
--------------------------------------------- ----- ----------- ------------
Revenue, net of royalties 1,306,681 2,804,425
--------------------------------------------- ----- ----------- ------------
Other income (losses)
Realized loss on financial derivatives (82,591) (198,093)
Unrealized (loss) gain on financial
derivatives (219,211) 161,981
Total income, before expenses 1,004,879 2,768,313
--------------------------------------------- ----- ----------- ------------
Expenses
Operating 628,043 906,666
Transportation 71,194 111,116
(MORE TO FOLLOW) Dow Jones Newswires
September 02, 2015 02:00 ET (06:00 GMT)
General and administrative 382,873 458,334
Depletion and depreciation 4 350,100 513,700
Stock-based compensation 41,515 114,686
Finance 313,253 335,626
Capital taxes 17,501 39,754
--------------------------------------------- ----- ----------- ------------
Total expenses 1,804,479 2,479,882
--------------------------------------------- ----- ----------- ------------
Income (loss) and comprehensive
income (loss) for the period $ (799,600) $ 288,431
--------------------------------------------- ----- ----------- ------------
Income (loss) and comprehensive
income (loss) per share
Basic and diluted $ (0.00) $ 0.00
--------------------------------------------- ----- ----------- ------------
Edge Resources Inc.
Condensed Interim Statement of Changes in Shareholders' Equity
(amounts in Canadian dollars)
(unaudited)
Total
Share Contributed Shareholders'
Capital surplus Deficit Equity
Balance at March 31, 2015 $ 36,111,048 $ 2,701,935 $ (35,553,952) $ 3,259,031
Stock-based compensation - 41,515 - 41,515
Loss for the period - - (799,600) (799,600)
Balance at June 30, 2015 $ 36,111,048 $ 2,743,450 $ (36,353,552) $ 2,500,946
--------------------------- ------------- ------------ --------------- ---------------
Balance at March 31, 2014 $ 36,094,048 $ 2,425,249 $ (24,096,038) $ 14,423,259
Issue of common shares on
exercise of stock options 17,000 (6,000) - 11,000
Stock-based compensation - 114,686 - 114,686
Income for the period - - 288,431 288,431
--------------------------- ------------- ------------ --------------- ---------------
Balance at June 30, 2014 $ 36,111,048 $ 2,533,935 $ (23,807,607) $ 14,837,376
--------------------------- ------------- ------------ --------------- ---------------
Condensed Interim Statement of Cash Flows
(amounts in Canadian dollars)
Three months ended
June 30, June 30,
Note 2015 2014
Cash flows provided by (used
for):
Cash flows generated from (used
in) operating activities
Income (loss) $ (799,600) $ 288,431
Items not affecting cash:
Unrealized loss (gain) on financial
derivatives 219,211 (161,981)
Foreign exchange loss - 564
Depletion and depreciation 350,100 513,700
Stock-based compensation 41,515 114,686
Accretion of decommissioning
provisions 45,000 44,000
Decommissioning expenditures (5,518) -
Changes in non-cash items 83,257 342,748
------------------------------------------------------ ----------- ----------
Net cash generated from (used
in) operating activities (66,035) 1,142,148
------------------------------------------------------ ----------- ----------
Cash flows used in investing
activities
Property, plant and equipment
expenditures (344,160) (363,171)
Changes in non-cash items (664,241) (77,746)
------------------------------------------------------ ----------- ----------
Net cash used in investing activities (1,008,401) (440,917)
------------------------------------------------------ ----------- ----------
Cash flows from financing activities
Proceeds from bank debt, net 870,000 100,000
Proceeds from issuance of common
shares - 11,000
Net cash from financing activities 870,000 111,000
------------------------------------------------------ ----------- ----------
Effect of exchange rate changes
on cash and cash equivalents
held in foreign currency - (564)
------------------------------------------------------ ----------- ----------
Net change in cash and cash
equivalents (bank overdraft) (204,436) 811,667
Cash and cash equivalents (bank
overdraft), beginning of period (26,367) (819,310)
------------------------------------------------------ ----------- ----------
Bank overdraft, end of period $ (230,803) $ (7,643)
------------------------------------------------------ ----------- ----------
Notes to the Condensed Interim Financial Statements
Three ended June 30, 2015
1. General business description
Edge Resources Inc. ("Edge" or the "Company") is engaged in the acquisition of, exploration for, development of and production of oil and natural gas. Edge is a publicly traded company on the TSX Venture Exchange under the symbol "EDE" and the Alternative Investment Market London Stock Exchange under the symbol "EDG", incorporated and domiciled in Canada. The address of business of the Company is Suite 1400, 717 - 7(th) Avenue SW, Calgary, Alberta, Canada, T2P 0Z3. These financial statements were approved and authorized for issuance by the Board of Directors on August 31, 2015.
These condensed interim financial statements have been prepared on a going concern basis which presumes that the Company will be able to discharge its obligations and realize its assets in the normal course of business. The Company had a loss and comprehensive loss of $0.8 million for the three month period ended June 30, 2015. As at June 30, 2015, the Company had a working capital deficiency of $8.0 million (March 31, 2015 - $7.7 million) that includes $7.3 million (March 31, 2015 - $6.4 million) in bank debt (excluding derivative assets/liabilities if any).
As per note 5, the Company has a revolving credit facility with a $17.0 million limit, and as of June 30, 2015, there was $9.7 million available for use. However, given the amount available for use under the facility is also limited by the "senior debt to cash flow" ratio, the actual limit will vary on a period by period basis. The calculations of the applicable ratios as of June 30, 2015 are presented in note 16 and the senior debt to cash flow ratio was not met at June 30, 2015. The breach has been communicated to the bank however because the Company is currently in the process of completing its regular annual review of the facilities no waiver will be sought for this breach. As a result of significantly weaker future commodity price forecasts, Management expects the lending limit on the revolving facility to be reduced although the amount of the reduction cannot be predicted at this time. As part of the regular annual review, management is also in discussion with the bank as to appropriate future financial covenants including the senior debt to cash flow covenant. Management actively forecasts applicable cash flows and will conduct an appropriate capital program based on estimated future credit facility availability. Management believes, despite the current significant decrease in world oil prices and its effect on Company cash flows, that with its current expected credit facility, equity raised subsequent to period end, and its near-term future equity-raising plans, that the Company will generate sufficient cash flows to meet its foreseeable obligations in the normal course of operations. Management has significantly delayed the Company's capital programs until the pricing environment further improves and has and continues to work on strategies to reduce general and administrative and operating costs subsequent to June 30, 2015.
Management has been and continues to be active in seeking alternative sources of funding to help accelerate its planned capital expenditure program, and to ultimately reduce its total debt. The Company cannot provide any assurance that sufficient cash flows will be generated from operating activities to reduce its working capital deficiency and to carry out its planned capital expenditure program.
The above-noted factors describe matters and conditions that indicate the existence of a material uncertainty that may cast significant doubt about the Company's ability to continue as a going concern. The Company's ability to continue as a going concern is dependent upon its ability to attain profitable operations, generate sufficient funds to continue its exploration and development activities, to repay its debts as they come due, and continue to obtain sufficient capital from investors or other sources of financing to meet its current and future obligations.
Management considers the Company is a going concern and has prepared the financial statements on a going concern basis.
2. Basis of preparation (a) Statement of compliance
(MORE TO FOLLOW) Dow Jones Newswires
September 02, 2015 02:00 ET (06:00 GMT)
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