In This Article:
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Production: Averaged over 2,100 barrels of oil equivalent per day in Q3, up 29% quarter-over-quarter and 24% year-over-year.
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Operating Netback: Reduced by over $5 per BOE from Q2, with a realized sales price drop from $71.97 to $66.46 per BOE.
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Realized Gas Price: Decreased from $1.183 to $1.092 per MCF in Q3.
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Profit Margin: Operating netback profit margin of 89%.
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Funds Flow from Operations: Increased by $2 million from $7.9 million to $9.9 million.
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Net Income: Increased by $4.8 million compared to Q2.
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Working Capital: Ended the period with $15.8 million, up $1.2 million from last quarter.
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Cash Balance: $24.5 million, debt-free for over two years.
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Dividends: Paid 9 US per quarter, translating to a yield of over 10%.
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Share Buyback: Introduced in late August, totaling about $0.25 million in Q3.
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2P Reserves: 4.6 million BOE at the Mecu 22 gas resource.
Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Alvopetro Energy Ltd (ALVOF) reported a 29% increase in production quarter over quarter, reaching over 2,100 barrels of oil equivalent per day.
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The company has a strong balance sheet with $24.5 million in cash and no debt, maintaining financial flexibility.
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Alvopetro Energy Ltd (ALVOF) achieved an operating netback of over $59 per BOE, reflecting a profit margin of 89%, which is considered best in class.
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The company has a disciplined capital allocation strategy, reinvesting roughly half of its cash flows into organic growth and returning the other half to stakeholders.
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Alvopetro Energy Ltd (ALVOF) introduced a share buyback program, repurchasing over 103,000 shares to date, enhancing shareholder value.
Negative Points
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The realized sales price per BOE decreased from $71.97 in Q2 to $66.46 in Q3, primarily due to foreign currency fluctuations.
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Production expenses increased by $193,000 due to the absence of historical tax credits that benefited the previous quarter.
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The company's October production was impacted by Bahia gas demand, resulting in a decrease to 1,912 barrels of oil equivalent per day.
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There is ongoing arbitration regarding the redetermination of the Cabaret working interest, which could impact future operations.
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The company's ability to ramp up drilling activity is limited by permitting, equipment availability, and plant capacity constraints.
Q & A Highlights
Q: How many shares have you repurchased this year, and do you expect the repurchase plan to reduce shares outstanding after employee stock plan issuances? A: In Q3, we repurchased 62,800 shares, and in October, another 41,700 shares, totaling just over 103,000 to date. The reduction in shares outstanding depends on the results and the pace of repurchasing shares. - Alison Howard, CFO