Berry Corporation (bry) Reduces Expenses by Lowering its Reserve Based Lending (RBL) Facility to $200 million and Increases i...
June 26 2020 - 5:21PM
Berry Corporation (bry) (NASDAQ: BRY) (“Berry” or the “Company”)
today reported that it completed its semi-annual bank
redetermination and reduced its RBL elected commitment to $200
million. This reduction equates to an annual savings of $1 million.
“Berry has responsibly run its operations out of Levered Free
Cash Flow1 since the current management team assumed leadership in
mid-2017. We primarily use our RBL credit facility to manage
working capital fluctuations and we have no outstanding borrowings
on the line today,” stated Cary Baetz, Berry’s EVP and CFO. “Given
our free cash flow generation expectations through 2021, we
currently don’t expect to use the line except for letters of
credit. The reduction in our RBL was purely an economic decision
that we believe is in the best interest of our shareholders. It is
not a reflection on Berry’s proved oil reserves as the borrowing
base would be substantially higher based on current unhedged Brent
crude oil strip pricing.”
The Company also announced that it added to its 2021 hedging
portfolio, which now has more than 14,300 barrels per day hedged at
roughly $46 Brent for the first half of 2021 and more than 11,300
barrels per day hedged at $46 Brent for the second half of 2021.
“This pricing is substantially better than we planned earlier this
year and improves our visibility and flexibility over the next year
and a half. We continue to plan for a two-year cyclical
low-crude price environment, and we have used recent crude price
upticks to protect our two-year plan. These hedges, combined with
cost improvements and efficiency, demonstrate Berry’s commitment to
create value throughout the cycle and continue to position the
company to emerge from the current environment in a position of
strength,” Cary Baetz expanded.
1 Levered Free Cash Flow is a non-GAAP financial measure that we
define as Adjusted EBITDA less capital expenditures, interest
expense, and dividends. Please see our 10-K or 10-Q for
definition for Adjusted EBITDA.
Forward-Looking Statements
The information in this press release includes 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. All
statements, other than statements of historical facts, included in
this press release that address plans, activities, events,
objectives, goals, strategies, or developments that the Company
expects, believes or anticipates will or may occur in the future
are forward-looking statements. The forward-looking statements in
this press release are based upon various assumptions, many of
which are based, in turn, upon further assumptions. Although we
believe that these assumptions were reasonable when made, these
assumptions are inherently subject to significant uncertainties and
contingencies which are difficult or impossible to predict and are
beyond our control. Therefore, such statements forward-looking
statements involve significant risks and uncertainties that could
materially affect our expected results of operations, liquidity,
cash flows and business prospects. Without limiting the generality
of the forgoing, such statements specifically include our
expectations, beliefs or projections as
to our future:
- financial position;
- liquidity;
- cash flows;
- anticipated financial and operating results;
- our capital program and development and production plans;
- business strategy;
- potential acquisition opportunities;
- other plans and objectives for operations;
- maintenance capital requirements;
- expected production and costs;
- reserves;
- hedging activities;
- return of capital;
- payment of future dividends;
- future repurchases of stock or debt; and
- capital investments and other guidance.
Actual results may differ materially from expectations and
reported results should not be considered an indication of future
performance. Known factors (but not all the factors) that could
cause actual results to differ materially from those discussed in
the forward-looking statements include:
- the length, scope and severity of the recent COVID-19 pandemic,
including the effects of related public health concerns and the
impact of actions taken by governmental authorities and other third
parties in response to the pandemic and its impact on commodity
prices, supply and demand considerations, and storage
capacity;
- global economic trends, geopolitical risks and general economic
and industry conditions, such as those resulting from the COVID-19
pandemic and from the actions of OPEC+, including the escalation of
tensions between Saudi Arabia and Russia and changes in OPEC+’s
production levels;
- volatility of oil, natural gas and NGL prices, including the
sharp decline in crude oil prices that occurred in the first
quarter and has continued into the second quarter of 2020;
- supply of and demand for oil, natural gas and NGLs;
- disruptions to, capacity constraints in, or other limitations
on the pipeline systems that deliver our oil and natural gas and
other processing and transportation considerations;
- inability to generate sufficient cash flow from operations or
to obtain adequate financing to fund capital expenditures,
meet our working capital requirements or fund planned
investments;
- price fluctuations and availability of natural gas and
electricity and the cost of steam;
- our ability to use derivative instruments to manage commodity
price risk;
- the regulatory environment, including availability or timing
of, and conditions imposed on, obtaining and/or maintaining permits
and approvals, including those necessary for drilling and/or
development projects;
- our ability to meet our planned drilling schedule, including
due to our ability to obtain permits on a timely basis or at all,
and to successfully drill wells that produce oil and natural gas in
commercially viable quantities;
- the impact of current, pending and/or future laws and
regulations, and of legislative and regulatory changes and other
government activities, including those related to drilling,
completion, well stimulation, operation, maintenance or abandonment
of wells or facilities, managing energy, water, land, greenhouse
gases or other emissions, protection of health, safety and the
environment, or transportation, marketing and sale of our
products;
- the California and global energy future, including the factors
and trends that are expected to shape it, such as concerns about
climate change and other air quality issues, the transition to a
low-emission economy and the expected role of different energy
sources;
- uncertainties associated with estimating proved reserves and
related future cash flows;
- our ability to replace our reserves through exploration and
development activities;
- drilling and production results, including lower-than-expected
production, reserves or resources from development projects or
higher-than-expected decline rates;
- our ability to obtain timely and available drilling and
completion equipment and crew availability and access to necessary
resources for drilling, completing and operating wells;
- changes in tax laws;
- effects of competition;
- uncertainties and liabilities associated with acquired and
divested assets;
- our ability to make acquisitions and successfully integrate any
acquired businesses;
- large or multiple customer defaults on contractual obligations,
including defaults resulting from actual or potential
insolvencies;
- geographical concentration of our operations;
- the creditworthiness and performance of our counterparties with
respect to our hedges;
- impact of derivatives legislation affecting our ability to
hedge;
- failure of risk management and ineffectiveness of internal
controls;
- catastrophic events, including wildfires, earthquakes and
pandemics;
- environmental risks and liabilities under federal, state,
tribal and local laws and regulations (including remedial
actions);
- potential liability resulting from pending or future
litigation;
- our ability to recruit and/or retain key members of our senior
management and key technical employees;
- information technology failures or cyber attacks; and other
material risks that appear in the Risk Factors section of our most
recent Quarterly Report on Form 10-Q, Annual Report on Form 10-K
and other periodic reports filed with the Securities and Exchange
Commission.
You can typically identify forward-looking statements by words
such as aim, anticipate, achievable, believe, continue, could,
estimate, expect, forecast, goal, guidance, intend, likely, may,
might, objective, outlook, plan, potential, predict, project, seek,
should, target, will or would and other similar words that reflect
the prospective nature of events or outcomes.
Any forward-looking statement speaks only as of the date on
which such statement is made, and we undertake no obligation to
correct or update any forward-looking statement, whether as a
result of new information, future events or otherwise except as
required by applicable law. Investors are urged to consider
carefully the disclosure in our filings with the Securities and
Exchange Commission, available from us at via our website or via
the Investor Relations contact below, or from the SEC’s
website at www.sec.gov.
About BerryBerry is a publicly traded
(NASDAQ:BRY) western United States independent upstream energy
company with a focus on the conventional, long-lived oil reserves
in the San Joaquin basin of California. More information can be
found at Berry’s website at www.bry.com.
Contact:
Berry Corporation (bry)
Todd Crabtree – Manager, Investor Relations
(661) 616-3811
ir@bry.com
Berry (NASDAQ:BRY)
Historical Stock Chart
From Jul 2024 to Aug 2024
Berry (NASDAQ:BRY)
Historical Stock Chart
From Aug 2023 to Aug 2024