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 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
|
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.
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content:https://www.prnewswire.com/news-releases/crescent-point-announces-q3-2022-results-and-2023-budget-301659334.html
SOURCE Crescent Point Energy Corp.