SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT
TO RULE 13a-16 OR 15d-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For the month of
October 2022
Commission File Number 001-36258
Crescent Point Energy Corp.
(Name of Registrant)
Suite 2000,
585-8th Avenue S.W.
Calgary, Alberta, T2P 1G1
(Address of Principal Executive Office)
Indicate by check mark whether the registrant files or
will file annual reports under cover of Form 20-F or Form 40-F.
Form
20-F ☐ Form
40-F ☒
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
Indicate by check mark whether by furnishing the information
contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b)
under the Securities Exchange Act of 1934.
Yes
☐ No ☒
If "Yes" is marked, indicate below the file
number assigned to the registrant in connection with Rule 12g3-2(b): 82- ________
DOCUMENTS FILED AS PART OF THIS FORM 6-K:
Exhibit No.
99.1 |
Description
News Release dated October 26, 2022 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
Crescent Point Energy Corp. |
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(Registrant) |
|
|
|
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By: |
/s/ Ken Lamont |
|
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Name: |
Ken Lamont |
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Title: |
Chief Financial Officer |
Date:October 26, 2022
EXHIBITS
Exhibit 99.1
Crescent Point Announces Q3 2022 Results and
2023 Budget
CALGARY, AB, Oct. 26, 2022 /CNW/ - Crescent Point
Energy Corp. ("Crescent Point" or the "Company") (TSX: CPG) (NYSE: CPG) is pleased to announce its operating and financial
results for the quarter ended September 30, 2022, its formal 2023 budget, a quarterly dividend and a special dividend, while also updating
its five-year outlook.
KEY HIGHLIGHTS
- Generated $233.7 million of excess cash flow in third quarter,
driven by the Company's high netback asset base.
- Returning 50 percent of discretionary excess flow, in addition
to the base dividend, to shareholders for third quarter 2022.
- Repurchased 8.2 million shares in third quarter and 3.0 million
shares to-date in October 2022.
- Declared a special dividend of $0.035 per share, based on third
quarter results, and a quarterly dividend of $0.08 per share.
- Disciplined 2023 guidance expected to generate $1.1 to $1.5 billion
of excess cash flow at US$75/bbl to US$85/bbl WTI.
- Achieved another strong IP30 rate of 900 boe/d per well on a recent
pad and acquired 80 net sections in Kaybob Duvernay.
- Received recognition of the Company's improved ESG practices through
MSCI's upgraded rating of "AA".
"We are returning a meaningful amount of capital
back to our shareholders for third quarter as a result of our strong financial and operational performance", said Craig Bryksa, President
and CEO of Crescent Point. "In addition, we bolstered our resource base through a land acquisition during the quarter while also
advancing other operational initiatives to further enhance our long-term sustainability. Our 2023 and five-year outlook are expected to
generate significant excess cash flow and returns for shareholders, further building on our continued execution."
FINANCIAL HIGHLIGHTS
- Adjusted funds flow totaled $576.5 million during third quarter
2022, or $1.02 per share diluted, driven by a strong operating netback of $59.28 per boe.
- For the quarter ended September 30, 2022, development capital
expenditures, which included drilling and development, facilities and seismic costs, totaled $308.5 million.
- The Company's excess cash flow in third quarter 2022 totaled $233.7
million.
- Crescent Point's net debt as at September 30, 2022 was $1.2 billion,
reflecting a reduction of approximately $270 million in the quarter. The Company reduced its net debt with proceeds received from the
disposition of certain non-core assets, as previously announced, and continued excess cash flow generation.
- Crescent Point reported net income of $466.4 million, or $0.82
per share diluted, for the quarter ended September 30, 2022.
RETURN OF CAPITAL HIGHLIGHTS
- Discretionary excess cash flow, or excess cash flow less base
dividends, totaled $188.8 million during third quarter 2022, of which approximately 50 percent is being returned to shareholders through
share repurchases and a special dividend.
- Total return of capital to shareholders for third quarter 2022,
including the base dividend, is $139.4 million.
- The Company remains active on its normal course issuer bid ("NCIB")
and repurchased 8.2 million shares in third quarter 2022 for approximately $75 million. Crescent Point has also repurchased 3.0 million
shares to date in October 2022 for approximately $29 million as part of its return of capital to shareholders during fourth quarter 2022.
- The Company's Board of Directors has declared a special cash dividend,
based on third quarter 2022 results, of $0.035 per share payable on November 14, 2022, to shareholders of record as of the close of business
on November 4, 2022.
- Subsequent to the quarter, Crescent Point's Board also declared
a quarterly cash base dividend of $0.08 per share payable on January 3, 2023 to shareholders of record on December 15, 2022.
OPERATIONAL HIGHLIGHTS
- Average production for the quarter ended September 30, 2022 was
133,019 boe/d, comprised of over 80 percent oil and liquids.
- Crescent Point continues to generate strong operational results
in its Kaybob Duvernay play, resulting in attractive asset level returns. The Company recently brought on stream its third fully operated
multi-well pad achieving an average 30-day initial production ("IP30") rate of approximately 900 boe/d per well (81% condensate,
5% NGL and 14% shale gas), which is expected to payout in approximately six months from the initial on-stream date at current commodity
prices.
- During third quarter, Crescent Point acquired additional lands
in the Kaybob Duvernay for cash consideration of approximately $87 million. This acquisition included approximately 80 net sections of
crown land with a 100 percent working interest, further expanding the Company's drilling inventory in the play. Given its significant
running room in the Kaybob Duvernay, Crescent Point expects to increase the proportion of capital it allocates to this high-return asset
within its five-year plan. As a result, production in this area is expected to grow in a disciplined manner from approximately 35,000
boe/d in 2022 to over 50,000 boe/d by 2027, subject to commodity prices.
- In its southeast and southwest Saskatchewan operations, Crescent
Point continued to advance its decline mitigation projects during third quarter to further enhance long-term sustainability. This included
secondary recovery waterflood programs and the initiation of a polymer flood, a tertiary form of recovery, within a unit in the Company's
Shaunavon play in southwest Saskatchewan.
- During third quarter 2022, Crescent Point successfully drilled
its first multi-lateral, open-hole horizontal well in its Viewfield Bakken play in southeast Saskatchewan with strong performance to-date.
The Company is currently drilling a subsequent multi-lateral, open-hole horizontal well in the play. This innovation in well design removes
the need for fracture stimulation and has the potential to expand the number of economic locations currently identified in the area.
- Crescent Point's continued commitment to strong environmental,
social and governance ("ESG") practices was recently recognized by Morgan Stanley Capital International ("MSCI") Inc.
which increased its rating to "AA". This is the second consecutive year the Company has received an increase in its ESG Ratings
assessment from MSCI Inc.
2022 GUIDANCE
- The Company's 2022 development capital expenditures guidance has
been slightly increased to $950 million, from $875 to $900 million previously. This increase reflects a higher inflationary cost environment
and Crescent Point's decision to maintain an active drilling rig in its Kaybob Duvernay and North Dakota plays where the Company is currently
ahead of schedule on its 2022 drilling program. Crescent Point remains on track to meet its 2022 annual average production guidance, which
is now at the mid-point of its prior range of 130,000 to 134,000 boe/d.
2023 GUIDANCE
- Crescent Point plans to generate annual average production of
134,000 to 138,000 boe/d in 2023. Based on development capital expenditures of $1.0 to $1.1 billion, the Company expects to generate approximately
$1.1 to $1.5 billion of excess cash flow at US$75/bbl to US$85/bbl WTI. The Company's 2023 budget, including its base dividend, is fully
funded at less than US$50/bbl WTI. Crescent Point expects to achieve this annual production guidance with spending toward the lower end
of its budget based on projected costs in the current commodity price environment.
- Crescent Point's allocation of its 2023 budget is centered around
risk-adjusted returns and remains focused within its four major operating areas. In the Kaybob Duvernay and North Dakota resource plays,
the Company plans to operate a one rig drilling program with a focus on realizing additional efficiencies. Crescent Point's Kaybob Duvernay
budget is also expected to include a step-out drilling program to identify new potential drilling locations. In southeast and southwest
Saskatchewan, the Company plans to continue to focus on low risk, high-return development, advancement of its decline mitigation programs
and further expansion of the economic boundaries within these assets.
- Consistent with its capital allocation framework, the Company
plans to allocate approximately 15 percent of its 2023 budget to long-term projects to enhance its sustainability. Such projects include
the continued advancement of various decline mitigation programs, such as waterflood and polymer floods, and environmental initiatives
designed to reduce Crescent Point's emissions and inactive well inventory.
OUTLOOK
Crescent Point continues to demonstrate strong operational
and financial execution, while taking a disciplined approach to capital allocation and maintaining its commitment to returning a meaningful
amount of capital back to shareholders.
The Company expects to generate significant excess
cash flow of approximately $1.1 to $1.5 billion, based on its 2023 guidance at US$75/bbl to US$85/bbl WTI, allowing for significant returns
to shareholders, including an expected further improvement in its leverage ratio to less than 0.3 times net debt to adjusted funds flow.
Approximately 15 percent of the Company's total production
is currently hedged in 2023, including over 20 percent in first half of the year. Crescent Point will remain disciplined in its hedging
strategy in the context of market conditions.
In conjunction with its 2023 budget, the Company has
updated its five-year outlook, which is expected to generate approximately $5.0 to $6.0 billion of cumulative after-tax excess cash flow
from 2023 to 2027, at US$75/bbl to US$85/bbl WTI. Crescent Point's five-year plan assumes annual average production increasing to approximately
145,000 boe/d by 2027, subject to commodity prices. This plan remains disciplined with a continued focus on returns and long-term sustainability.
Crescent Point remains in a strong financial position
and is focused on creating long-term value for shareholders through a combination of returning capital and continually enhancing the sustainability
of the business on a per-share basis.
CONFERENCE CALL DETAILS
Crescent Point management will hold a conference call
on Wednesday, October 26, 2022 at 10:00 a.m. MT (12:00 p.m. ET) to discuss the Company's results and outlook. A slide deck will accompany
the conference call and can be found on Crescent Point's website.
Participants can listen to this event online.
Alternatively, the conference call can be accessed by dialing 1-888-390-0605.
The webcast will be archived for replay and can be
accessed online at Crescent Point's conference calls and webcasts page. The replay will be available approximately one hour following
completion of the call.
Shareholders and investors can also find the Company's
most recent investor presentation on Crescent Point's website.
2022 GUIDANCE
|
Prior |
Revised |
Total Annual Average Production (boe/d) (1) |
130,000 - 134,000 |
132,000 |
|
|
|
Capital Expenditures |
|
|
Development capital expenditures ($ millions) |
$875 - $900 |
$950 |
Capitalized administration ($ millions) |
$40 |
$45 |
Total ($ millions) (2) |
$915 - $940 |
$995 |
|
|
|
Other Information for 2022 Guidance |
|
|
Reclamation activities ($ millions) (3) |
$20 |
$20 |
Capital lease payments ($ millions) |
$20 |
$20 |
Annual operating expenses ($/boe) |
$13.75 - $14.25 |
$14.75 |
1) Total annual average production (boe/d) is comprised of approximately 80% Oil, Condensate & NGLs and 20% Natural Gas |
2) Land expenditures and net property acquisitions and dispositions are not included. Development capital expenditures spend is
allocated on an approximate basis as follows: 90% drilling & development and 10% facilities & seismic |
3) Reflects Crescent Point's portion of its expected total budget |
2023 GUIDANCE
Total Annual Average Production (boe/d) (1) |
134,000 - 138,000 |
Capital Expenditures |
|
Development capital expenditures ($ millions) |
$1,000 - $1,100 |
Capitalized administration ($ millions) |
$40 |
Total ($ millions) (2) |
$1,040 - $1,140 |
|
|
Other Information for 2023 Guidance |
|
Reclamation activities ($ millions) (3) |
$40 |
Capital lease payments ($ millions) |
$20 |
1) Total annual average production (boe/d) is comprised of approximately 80% Oil, Condensate & NGLs and 20% Natural Gas |
2)
Land expenditures and net property acquisitions and dispositions are not included. Development capital expenditures spendis allocated
on an approximate basis as follows: 90% drilling & development and 10% facilities & seismic |
3) Reflects Crescent Point's portion of its expected total budget |
RETURN OF CAPITAL OUTLOOK
Base Dividend |
|
Current quarterly base dividend per share |
$0.08 |
Additional Return of Capital |
|
% of discretionary excess cash flow (1)(2) |
50 % |
1) Discretionary excess cash flow is calculated as excess cash flow less base dividends |
2) This % is part of a framework that targets to return up to 50% of discretionary excess cash flow to shareholders |
The Company's unaudited financial statements and management's
discussion and analysis for the quarter ended September 30, 2022, will be available on the System for Electronic Document Analysis and
Retrieval ("SEDAR") at www.sedar.com, on EDGAR at www.sec.gov/edgar and on Crescent Point's website at www.crescentpointenergy.com
FINANCIAL AND OPERATING HIGHLIGHTS
|
Three months ended September 30 |
Nine months ended September 30 |
(Cdn$ millions except per share and per boe amounts) |
2022 |
2021 |
2022 |
2021 |
Financial |
|
|
|
|
Cash flow from operating activities |
647.0 |
414.2 |
1,602.7 |
1,003.4 |
Adjusted funds flow from operations (1) |
576.5 |
393.9 |
1,709.6 |
1,044.4 |
Per share (1) (2) |
1.02 |
0.67 |
2.97 |
1.83 |
Net income |
466.4 |
77.5 |
1,981.5 |
2,242.5 |
Per share (2) |
0.82 |
0.13 |
3.44 |
3.93 |
Adjusted net earnings from operations (1) |
242.9 |
142.6 |
755.9 |
355.3 |
Per share (1) (2) |
0.43 |
0.24 |
1.31 |
0.62 |
Dividends declared |
44.9 |
19.0 |
81.8 |
21.8 |
Per share (2) |
0.0800 |
0.0325 |
0.1450 |
0.0375 |
Net debt (1) |
1,198.3 |
2,138.8 |
1,198.3 |
2,138.8 |
Net debt to adjusted funds flow from operations (1) (3) |
0.6 |
1.7 |
0.6 |
1.7 |
Weighted average shares outstanding |
|
|
|
|
Basic |
563.6 |
582.0 |
570.6 |
564.9 |
Diluted |
567.4 |
587.1 |
575.2 |
570.7 |
Operating |
|
|
|
|
Average daily production |
|
|
|
|
Crude oil and condensate (bbls/d) |
91,762 |
92,206 |
91,989 |
98,298 |
NGLs (bbls/d) |
17,198 |
18,176 |
16,793 |
16,719 |
Natural gas (mcf/d) |
144,356 |
130,823 |
137,277 |
110,604 |
Total (boe/d) |
133,019 |
132,186 |
131,662 |
133,451 |
Average selling prices (4) |
|
|
|
|
Crude oil and condensate ($/bbl) |
111.46 |
82.45 |
119.81 |
74.54 |
NGLs ($/bbl) |
43.83 |
45.24 |
47.33 |
40.12 |
Natural gas ($/mcf) |
6.55 |
4.29 |
6.69 |
4.07 |
Total ($/boe) |
89.66 |
67.99 |
96.72 |
63.30 |
Netback ($/boe) |
|
|
|
|
Oil and gas sales |
89.66 |
67.99 |
96.72 |
63.30 |
Royalties |
(12.33) |
(8.35) |
(13.08) |
(8.07) |
Operating expenses |
(15.12) |
(12.97) |
(14.86) |
(12.93) |
Transportation expenses |
(2.93) |
(2.52) |
(2.83) |
(2.41) |
Operating netback (1) |
59.28 |
44.15 |
65.95 |
39.89 |
Realized loss on commodity derivatives |
(9.82) |
(7.26) |
(15.20) |
(6.74) |
Other (5) |
(2.35) |
(4.50) |
(3.19) |
(4.48) |
Adjusted funds flow from operations netback (1) |
47.11 |
32.39 |
47.56 |
28.67 |
Capital Expenditures |
|
|
|
|
Capital acquisitions (6) |
88.2 |
0.9 |
89.4 |
937.2 |
Capital dispositions (6) |
(244.1) |
(3.8) |
(284.8) |
(98.9) |
Development capital expenditures |
|
|
|
|
Drilling and development |
280.8 |
161.3 |
651.8 |
324.8 |
Facilities and seismic |
27.7 |
25.8 |
57.9 |
69.9 |
Total |
308.5 |
187.1 |
709.7 |
394.7 |
Land expenditures |
5.7 |
1.2 |
15.0 |
4.1 |
(1) Specified financial measure that does not have any standardized meaning prescribed by IFRS and, therefore, may not be comparable with the calculation of similar measures presented by other entities. Refer to the Specified Financial Measures section for further information. |
(2) The per share amounts (with the exception of dividends per share) are the per share – diluted amounts. |
(3) Net debt to adjusted funds flow from operations is calculated as the period end net debt divided by the sum of adjusted funds flow from operations for the trailing four quarters. |
(4) The average selling prices reported are before realized derivatives and transportation. |
(5) Other includes net purchased products, general and administrative expenses, interest on long-term debt, foreign exchange, cash-settled share-based compensation and certain cash items and excludes transaction costs, foreign exchange on US dollar long-term debt and certain non-cash items. |
(6) Capital acquisitions and dispositions represent total consideration for the transactions, including long-term debt and working capital assumed, and exclude transaction costs. |
Specified Financial Measures
Throughout this press release, the Company uses the
terms "adjusted funds flow" (equivalent to "adjusted funds flow from operations"), "adjusted funds flow from
operations per share - diluted", "adjusted net earnings from operations", "adjusted net earnings from operations per
share - diluted", "excess cash flow", "discretionary excess cash flow", "net debt", "net debt
to adjusted funds flow" (equivalent to "net debt to adjusted funds flow from operations" and "leverage ratio"),
"total operating netback", "total netback", "operating netback", "netback", "adjusted funds
flow from operations netback" and "adjusted working capital (surplus) deficiency". These terms do not have any standardized
meaning as prescribed by IFRS and, therefore, may not be comparable with the calculation of similar measures presented by other issuers.
For information on the composition of these measures and how the Company uses these measures, refer to the Specified Financial Measures
section of the Company's MD&A for the period ended September 30, 2022, which section is incorporated herein by reference, and available
on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/edgar.
Adjusted funds flow from operations netback is a non-GAAP
financial ratio and is calculated as adjusted funds flow from operations divided by total production. Adjusted funds flow from operations
netback is a common metric used in the oil and gas industry and is used to measure operating results on a per boe basis.
The following table reconciles oil and gas sales to
total operating netback, total netback and adjusted funds flow from operations netback:
|
Three months ended September 30 |
|
Nine months ended September 30 |
|
($ millions) |
2022 |
|
2021 |
|
% Change |
|
2022 |
|
2021 |
|
% Change |
|
Oil and gas sales |
1,097.3 |
|
826.7 |
|
33 |
|
3,476.5 |
|
2,306.1 |
|
51 |
|
Royalties |
(150.9) |
|
(101.5) |
|
49 |
|
(470.0) |
|
(294.0) |
|
60 |
|
Operating expenses |
(185.0) |
|
(157.7) |
|
17 |
|
(534.2) |
|
(471.1) |
|
13 |
|
Transportation expenses |
(35.9) |
|
(30.6) |
|
17 |
|
(101.7) |
|
(87.9) |
|
16 |
|
Total operating netback |
725.5 |
|
536.9 |
|
35 |
|
2,370.6 |
|
1,453.1 |
|
63 |
|
Realized loss on commodity derivatives |
(120.2) |
|
(88.2) |
|
36 |
|
(546.2) |
|
(245.6) |
|
122 |
|
Total netback |
605.3 |
|
448.7 |
|
35 |
|
1,824.4 |
|
1,207.5 |
|
51 |
|
Other (1) |
(28.8) |
|
(54.8) |
|
(47) |
|
(114.8) |
|
(163.1) |
|
(30) |
|
Total adjusted funds flow from operations netback |
576.5 |
|
393.9 |
|
46 |
|
1,709.6 |
|
1,044.4 |
|
64 |
|
(1)
Other includes net purchased products, general and administrative expenses, interest on long-term debt, foreign exchange, cash-settled
share-based compensation and certain cash items and excludes transaction costs, foreign exchange on US dollar long-term debt and certain
non-cash items. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table reconciles cash flow from operating
activities to adjusted funds flow from operations, excess cash flow and discretionary excess cash flow:
|
Three months ended September 30 |
|
Nine months ended September 30 |
|
($ millions) |
2022 |
|
2021 (1) |
|
% Change |
|
2022 |
|
2021 (1) |
|
% Change |
|
Cash flow from operating activities |
647.0 |
|
414.2 |
|
56 |
|
1,602.7 |
|
1,003.4 |
|
60 |
|
Changes in non-cash working capital |
(79.3) |
|
(23.7) |
|
235 |
|
86.8 |
|
17.5 |
|
396 |
|
Transaction costs |
2.9 |
|
0.4 |
|
625 |
|
3.3 |
|
12.2 |
|
(73) |
|
Decommissioning expenditures (2) |
5.9 |
|
3.0 |
|
97 |
|
16.8 |
|
11.3 |
|
49 |
|
Adjusted funds flow from operations |
576.5 |
|
393.9 |
|
46 |
|
1,709.6 |
|
1,044.4 |
|
64 |
|
Capital expenditures |
(324.2) |
|
(198.1) |
|
64 |
|
(762.5) |
|
(433.2) |
|
76 |
|
Payments on lease liability |
(5.1) |
|
(5.4) |
|
(6) |
|
(15.3) |
|
(15.6) |
|
(2) |
|
Decommissioning expenditures |
(5.9) |
|
(3.0) |
|
97 |
|
(16.8) |
|
(11.3) |
|
49 |
|
Other items (3) |
(7.6) |
|
14.1 |
|
(154) |
|
(14.2) |
|
21.7 |
|
(165) |
|
Excess cash flow |
233.7 |
|
201.5 |
|
16 |
|
900.8 |
|
606.0 |
|
49 |
|
Dividends (4) |
(44.9) |
|
(19.0) |
|
136 |
|
(81.8) |
|
(21.8) |
|
275 |
|
Discretionary excess cash flow |
188.8 |
|
182.5 |
|
3 |
|
819.0 |
|
584.2 |
|
40 |
|
(1) Comparative period revised to reflect current year presentation. |
(2) Excludes amounts received from government subsidy programs. |
(3) Other items include, but are not limited to, unrealized gains and losses on equity derivative contracts and transaction costs. Other items exclude net acquisitions and dispositions. |
(4) Dividends is equivalent to base dividends as there were no special dividends declared in the three and nine months ended September 30, 2022 and September 30, 2021. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted funds flow from operations per share - diluted
is a supplementary financial measure and is calculated as adjusted funds flow from operations divided by the number of weighted average
diluted shares outstanding. It is used as a key measure to assess the ability of the Company to finance dividends, operating activities,
capital expenditures and debt repayments.
The following table reconciles adjusted working capital
(surplus) deficiency:
($ millions) |
September 30, 2022 |
|
December 31, 2021 |
|
% Change |
|
Accounts payable and accrued liabilities |
503.8 |
|
450.7 |
|
12 |
|
Dividends payable |
44.9 |
|
43.5 |
|
3 |
|
Long-term compensation liability (1) |
45.9 |
|
42.6 |
|
8 |
|
Cash |
(225.5) |
|
(13.5) |
|
1,570 |
|
Accounts receivable |
(400.0) |
|
(314.3) |
|
27 |
|
Prepaids and deposits |
(17.0) |
|
(7.4) |
|
130 |
|
Adjusted working capital (surplus) deficiency |
(47.9) |
|
201.6 |
|
(124) |
|
(1) Includes current portion of long-term compensation liability and is net of equity derivative contracts. |
|
|
|
|
|
|
|
|
|
|
The following table reconciles long-term debt to net
debt:
($ millions) |
September 30, 2022 |
|
December 31, 2021 |
|
% Change |
|
Long-term debt (1) |
1,456.8 |
|
1,970.2 |
|
(26) |
|
Adjusted working capital (surplus) deficiency |
(47.9) |
|
201.6 |
|
(124) |
|
Unrealized foreign exchange on translation of US dollar long-term debt |
(210.6) |
|
(166.8) |
|
26 |
|
Net debt |
1,198.3 |
|
2,005.0 |
|
(40) |
|
(1) Includes current portion of long-term debt. |
|
|
|
|
|
|
|
|
|
The following table reconciles net income to adjusted
net earnings from operations:
|
Three months ended September 30 |
|
Nine months ended September 30 |
|
($ millions) |
2022 |
|
2021 |
|
% Change |
|
2022 |
|
2021 |
|
% Change |
|
Net income |
466.4 |
|
77.5 |
|
502 |
|
1,981.5 |
|
2,242.5 |
|
(12) |
|
Amortization of E&E undeveloped land |
1.2 |
|
14.3 |
|
(92) |
|
12.4 |
|
41.4 |
|
(70) |
|
Impairment reversal |
— |
|
— |
|
— |
|
(1,484.9) |
|
(2,514.4) |
|
(41) |
|
Unrealized derivative (gains) losses |
(349.5) |
|
3.2 |
|
(11,022) |
|
(117.3) |
|
228.5 |
|
(151) |
|
Unrealized foreign exchange (gain) loss on translation
of hedged US dollar long-term debt |
76.9 |
|
25.9 |
|
197 |
|
43.8 |
|
(23.9) |
|
(283) |
|
Unrealized (gain) loss on long-term investments |
— |
|
3.0 |
|
(100) |
|
— |
|
(3.1) |
|
(100) |
|
Gain on sale of long-term investments |
— |
|
(7.0) |
|
(100) |
|
— |
|
(7.0) |
|
(100) |
|
Gain on capital dispositions |
(23.3) |
|
(1.9) |
|
1,126 |
|
(26.1) |
|
(58.4) |
|
(55) |
|
Deferred tax adjustments |
71.2 |
|
27.6 |
|
158 |
|
346.5 |
|
449.7 |
|
(23) |
|
Adjusted net earnings from operations |
242.9 |
|
142.6 |
|
70 |
|
755.9 |
|
355.3 |
|
113 |
|
Excess cash flow forecasted for 2022 and 2023 are
forward-looking non-GAAP measures and are calculated consistently with the measures disclosed in the Company's MD&A. Refer to the
Specified Financial Measures section of the Company's MD&A for the period ended September 30, 2022.
Management believes the presentation of the specified
financial measures above provide useful information to investors and shareholders as the measures provide increased transparency and the
ability to better analyze performance against prior periods on a comparable basis.
Forward-Looking Statements
Any "financial outlook" or "future
oriented financial information" in this press release, as defined by applicable securities legislation has been approved by management
of Crescent Point. Such financial outlook or future oriented financial information is provided for the purpose of providing information
about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may
not be appropriate for other purposes.
Certain statements contained in this press release
constitute "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933 and section 21E of the
Securities Exchange Act of 1934 and "forward-looking information" for the purposes of Canadian securities regulation (collectively,
"forward-looking statements"). The Company has tried to identify such forward-looking statements by use of such words as "could",
"should", "can", "anticipate", "expect", "believe", "will", "may",
"intend", "projected", "sustain", "continues", "strategy", "potential", "projects",
"grow", "take advantage", "estimate", "well-positioned" and other similar expressions, but these
words are not the exclusive means of identifying such statements.
In particular, this press release contains forward-looking
statements pertaining, among other things, to the following: 2023 guidance of expected to generate $1.1 to $1.5 billion of excess cash
flow at US$75/bbl to US$85/bbl WTI; 2023 development capital expenditures of $1.0 to $1.1 billion; enhanced long-term sustainability;
2023 budget and five-year outlook generating significant excess cash flow and returns for shareholders; generating significant excess
cash flow and returns for shareholders; attractive asset level returns in the Kaybob Duvernay; payout of third fully operated multi-well
pad in the Kaybob Duvernay at current commodity prices; significant running room in the Kaybob Duvernay; plans to increase the proportion
of capital allocated to the Kaybob Duvernay within the five-year plan; Kaybob-Duvernay production expected to grow in a disciplined manner
from approximately 35,000 boe/d in 2022 to over 50,000 boe/d by 2027, subject to commodity price; benefits of decline mitigation projects;
innovations in well design; 2022 development capital expenditures; the Company's 2023 budget is fully funded at less than US$50/bbl WTI
including base dividend; Crescent Point expects to achieve 2023 production guidance with spending toward the lower end of its budget based
on projected costs in the current commodity price environment; 2023 budget allocation; drilling plans and programs; 2023 budget allocations
by area; plans to continue to focus on low risk, high-return development, advancement of its decline mitigation programs and further expansion
of the economic boundaries within certain assets; 2023 budget allocations to long-term projects, and the benefits thereof; 2023 significant
returns to shareholders, including a further improvement in the Company's leverage ratio to less than 0.3 times net debt to adjusted funds
flow; hedging plans and the extent of hedging; five-year outlook, expected to generate approximately $5.0 to $6.0 billion of cumulative
after-tax excess cash flow from 2023 to 2027, at US$75/bbl to US$85/bbl WTI, assuming annual average production increasing to approximately
145,000 boe/d by 2027, subject to commodity prices, creating long-term value for shareholders through a combination of returning capital,
and continually enhancing the sustainability of the business on a per-share basis; 2022 and 2023 guidance including: expected total annual
average production, capital expenditures (including development capital expenditures and capitalized administration) and other information
for 2022 and 2023 guidance including reclamation activities, capital lease payments, annual operations expenses and royalties; and the
Company's return of capital outlook, including base dividend and additional returns of capital (% of discretionary excess cash flow).
Statements relating to "reserves" are also
deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the
reserves described exist in the quantities predicted or estimated and that the reserves can be profitably produced in the future. Actual
reserve values may be greater than or less than the estimates provided herein. Unless otherwise noted, reserves referenced herein are
given as at December 31, 2021. Also, estimates of reserves and future net revenue for individual properties may not reflect the same confidence
level as estimates and future net revenue for all properties due to the effect of aggregation. All required reserve information for the
Company is contained in its Annual Information Form for the year ended December 31, 2021 which is accessible at www.sedar.com.
With respect to disclosure contained herein regarding
resources other than reserves, there is uncertainty that it will be commercially viable to produce any portion of the resources and
there is significant uncertainty regarding the ultimate recoverability of such resources.
All forward-looking statements are based on Crescent
Point's beliefs and assumptions based on information available at the time the assumption was made. Crescent Point believes that the expectations
reflected in these forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct
and such forward-looking statements included in this report should not be unduly relied upon. By their nature, such forward-looking statements
are subject to a number of risks, uncertainties and assumptions, which could cause actual results or other expectations to differ materially
from those anticipated, expressed or implied by such statements, including those material risks discussed in the Company's Annual Information
Form for the year ended December 31, 2021 under "Risk Factors" and our Management's Discussion and Analysis for the year ended
December 31, 2021, and for the quarter ended September 30, 2022, under the headings "Risk Factors" and "Forward-Looking
Information". The material assumptions are disclosed in the Management's Discussion and Analysis for the three months ended September
30, 2022, under the headings "Overview", "Commodity Derivatives", "Liquidity and Capital Resources", "Guidance",
"Royalties" and "Operating Expenses". In addition, risk factors include: financial risk of marketing reserves at an
acceptable price given market conditions; volatility in market prices for oil and natural gas, decisions or actions of OPEC and non-OPEC
countries in respect of supplies of oil and gas; delays in business operations or delivery of services due to pipeline restrictions, rail
blockades, outbreaks, blowouts and business closures and social distancing measures mandated by public health authorities in response
to COVID-19, including current and new variants thereof; the risk of carrying out operations with minimal environmental impact; industry
conditions including changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how
they are interpreted and enforced; uncertainties associated with estimating oil and natural gas reserves; risks and uncertainties related
to oil and gas interests and operations on Indigenous lands; economic risk of finding and producing reserves at a reasonable cost; uncertainties
associated with partner plans and approvals; operational matters related to non-operated properties; increased competition for, among
other things, capital, acquisitions of reserves and undeveloped lands; competition for and availability of qualified personnel or management;
incorrect assessments of the value and likelihood of acquisitions and dispositions, and exploration and development programs; unexpected
geological, technical, drilling, construction, processing and transportation problems; the impact of severe weather events; availability
of insurance; fluctuations in foreign exchange and interest rates; stock market volatility; general economic, market and business conditions,
including uncertainty in the demand for oil and gas and economic activity in general as a result of the COVID-19 pandemic; changes in
interest rates and inflation; uncertainties associated with regulatory approvals; geopolitical conflicts, including the Russian invasion
of Ukraine; uncertainty of government policy changes; the impact of the implementation of the Canada-United States-Mexico Agreement; uncertainty
regarding the benefits and costs of dispositions; failure to complete acquisitions and dispositions; uncertainties associated with credit
facilities and counterparty credit risk; changes in income tax laws, tax laws, crown royalty rates and incentive programs relating to
the oil and gas industry; the wide-ranging impacts of the COVID-19 pandemic, including on demand, health and supply chain; and other factors,
many of which are outside the control of the Company. The impact of any one risk, uncertainty or factor on a particular forward-looking
statement is not determinable with certainty as these are interdependent and Crescent Point's future course of action depends on management's
assessment of all information available at the relevant time.
Included in this presentation are Crescent Point's
2022 and 2023 guidance in respect of capital expenditures and average annual production, 5-year outlook, and 2022 and 2023 expectations,
which are based on various assumptions as to production levels, commodity prices and other assumptions and are provided for illustration
only and are based on budgets and forecasts that have not been finalized and are subject to a variety of contingencies including prior
years' results. To the extent such estimates constitute a "financial outlook" or "future oriented financial information"
in this presentation, as defined by applicable securities legislation, such information has been approved by management of Crescent Point.
Such financial outlook or future oriented financial information is provided for the purpose of providing information about management's
current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate
for other purposes.
Additional information on these and other factors
that could affect Crescent Point's operations or financial results are included in Crescent Point's reports on file with Canadian and
U.S. securities regulatory authorities. Readers are cautioned not to place undue reliance on this forward-looking information, which is
given as of the date it is expressed herein or otherwise. Crescent Point undertakes no obligation to update publicly or revise any forward-looking
statements, whether as a result of new information, future events or otherwise, unless required to do so pursuant to applicable law. All
subsequent forward-looking statements, whether written or oral, attributable to Crescent Point or persons acting on the Company's behalf
are expressly qualified in their entirety by these cautionary statements.
Product Type Production Information
The Company's aggregate average production for the
three and nine months ended September 30, 2022 and September 30, 2021 and the references to "natural gas" and "crude oil",
reported in this Press Release consist of the following product types, as defined in NI 51-101 and using a conversion ratio of 6 mcf :
1 bbl where applicable:
|
Three months ended September 30 |
Nine months ended September 30 |
|
2022 |
2021 |
2022 |
2021 |
Light & Medium Crude Oil (bbl/d) |
12,347 |
15,046 |
14,477 |
18,651 |
Heavy Crude Oil (bbl/d) |
4,102 |
4,199 |
4,080 |
4,196 |
Tight Oil (bbl/d) |
54,030 |
58,233 |
54,455 |
64,689 |
Total Crude Oil (bbl/d) |
70,479 |
77,478 |
73,012 |
87,536 |
|
|
|
|
|
NGLs (bbl/d) |
38,481 |
32,904 |
35,770 |
27,481 |
|
|
|
|
|
Shale Gas (mcf/d) |
134,049 |
117,339 |
126,892 |
98,959 |
Conventional Natural Gas (mcf/d) |
10,307 |
13,484 |
10,385 |
11,644 |
Total Natural Gas (mcf/d) |
144,356 |
130,823 |
137,277 |
110,603 |
|
|
|
|
|
Total (boe/d) |
133,019 |
132,186 |
131,662 |
133,451 |
Barrels of oil equivalent ("boe") 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 oil, utilizing a conversion
on a 6:1 basis may be misleading as an indication of value.
This press release contains metrics commonly used
in the oil and natural gas industry, including "netback" and "payout". These terms do not have a standardized meaning
and may not be comparable to similar measures presented by other companies and, therefore, should not be used to make comparisons. Readers
are cautioned as to the reliability of oil and gas metrics used in this press release. Management uses these oil and gas metrics for its
own performance measurements and to provide investors with measures to compare the Company's performance over time; however, such measures
are not reliable indicators of the Company's future performance, which may not compare to the Company's performance in previous periods,
and therefore should not be unduly relied upon. Netback is used by management to measure operating results on a per boe basis to better
analyze performance against prior periods on a comparable basis. Payout is the point at which all costs associated with leasing, exploring,
drilling and operating have been recovered from the production of a well. It is an indication of profitability. In this press release
payout is based upon the booked 2P type-well data prepared by McDaniel & Associates Consultants Ltd. having an effective date of December
31, 2021.
Initial production is for a limited time frame only
(30 days) and may not be indicative of future performance.
NI 51-101 includes condensate within the natural gas
liquids (NGLs) product type. The Company has disclosed condensate as combined with crude oil and/or separately from other natural gas
liquids in this press release since the price of condensate as compared to other natural gas liquids is currently significantly higher
and the Company believes that this crude oil and condensate presentation provides a more accurate description of its operations and results.
FOR MORE INFORMATION ON CRESCENT POINT ENERGY,
PLEASE CONTACT:
Shant Madian, Vice President, Capital Markets,
or
Sarfraz Somani, Manager, Investor Relations
Telephone: (403) 693-0020 Toll-free (US and Canada): 888-693-0020 Fax: (403) 693-0070
Address: Crescent Point Energy Corp. Suite 2000, 585 - 8th Avenue S.W. Calgary AB T2P 1G1
www.crescentpointenergy.com
Crescent Point shares are traded on the Toronto Stock
Exchange and New York Stock Exchange under the symbol CPG.
View original content:https://www.prnewswire.com/news-releases/crescent-point-announces-q3-2022-results-and-2023-budget-301659334.html
SOURCE Crescent Point Energy Corp.
View original content: http://www.newswire.ca/en/releases/archive/October2022/26/c6700.html
%CIK: 0001545851
CO: Crescent Point Energy Corp.
CNW 06:30e 26-OCT-22
This regulatory filing also includes additional resources:
ex991.pdf
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