Triangle Petroleum Provides Financial Results and Operational Update For All Business Segments For Fourth Quarter and Full Fiscal Year 2015

News provided by

Triangle Petroleum Corporation

Apr 13, 2015, 05:32 ET

DENVER, April 13, 2015 /PRNewswire/ -- Triangle Petroleum Corporation ("Triangle" or the "Company") (NYSE MKT: TPLM) today provides an operational update and reports its fourth quarter fiscal year 2015 ("Q4 2015") and full fiscal year 2015 ("FY 2015") results for the period ended January 31, 2015.

Highlights for Fiscal Year 2015

  • Increased volumes in FY 2015 to 4,176 Mboe (+116% y/y) as compared to 1,929 Mboe in fiscal year 2014 ("FY 2014").  Average daily production increased to 11,441 Boepd in FY 2015, or 2% above the high end of our FY 2015 guidance range of 10,200-11,200 Boepd, from 5,286 Boepd in FY 2014
  • Total capital expenditures amounted to approximately $671.9 million, in line with full year budget guidance
  • Increased consolidated adjusted net income in FY 2015 to $54.1 million, or $0.58 per fully diluted EPS (+21% y/y), as compared to $37.4 million, or $0.48 per fully diluted EPS in FY 2014
  • Increased total estimated net proved reserves to 58,870 Mboe (61% proved developed) at fiscal year-end 2015, a 46% increase over fiscal year-end 2014 total estimated net proved reserves, with an associated increase in SEC PV-10 to approximately $983 million (+45% y/y)
  • Repurchased and retired $20.5 million face value of Triangle USA Petroleum Corporation ("TUSA") outstanding 6.75% bonds for just under $13.9 million
  • Repurchased 6.5 million shares of common stock at an average price of $4.94 per share in Q4 2015, bringing cumulative repurchases during FY 2015 to approximately 11.4 million shares at an average price of $6.72 per share leaving a total of approximately 75.2 million shares outstanding at January 31, 2015 
  • $428.7 million of total liquidity as of January 31, 2015, including $67.9 million of cash on hand and available borrowing capacity on TUSA and RockPile Energy Services ("RockPile") credit facilities

Segment Financial Results

FY 2015 and Q4 2015 stand-alone revenue and Adjusted-EBITDA (reference accompanying "Reconciliation Tables" as well as "Use of Segment Information and Non-GAAP Measures" disclosures at end of press release)

FY 2015

Revenue

y/y % Change

Adj.-EBITDA

y/y % Change

E&P

$284.5

77%

$208.2

86%

RockPile

$418.1

116%

$95.1

127%

Total

$702.6

98%

$303.3

97%

*Dollars in U.S. millions

*Exploration and production operating segment ("E&P") Adjusted-EBITDA includes all exploration and production related business lines, and does not include TPC (parent company) other revenues and expenses

 

Q4 2015

Revenue

y/y % Change

Adj.-EBITDA

y/y % Change

E&P

$63.0

28%

$54.2

69%

RockPile

$111.1

97%

$17.9

71%

Total

$174.2

65%

$72.1

70%

*Dollars in U.S. millions. Total amounts vary due to rounding


*Exploration and production operating segment ("E&P") Adjusted-EBITDA includes all exploration and production related business lines, and does not include TPC (parent company) other revenues and expenses

 

Operational Update

  • TUSA generated $284.5 million of revenue in FY 2015 (+77% y/y) as compared to $160.5 of revenue in FY 2014.  In Q4 2015, TUSA generated $63.0 million of revenue (+28% y/y) as compared to $49.4 million in Q4 2014
  • Increased Q4 2015 volumes to 1,357 Mboe (+103% y/y) from 667 Mboe in Q4 2014. Q4 2015 average daily volumes were 14,747 Boepd as compared to 7,249 Boepd in Q4 2014 
  • Spud 62 gross (43.9 net) and completed 49 gross (34.5 net) operated wells with a four-rig operated program in FY 2015
    • Incurred $435 million of operated and non-operated drilling and completion capex in FY 2015
      • Includes a consolidated elimination benefit from RockPile, Caliber Midstream Partners L.P. ("Caliber"), and other services in FY 2015 resulting in an aggregate net reduction of $31.6 million in oil and natural gas property expenditures, which represents an approximate 7% cost savings
    • Reduced gross well costs to $10.2 million on average in FY 2015 (-14% y/y) with recent gross well AFEs coming in under $8 million and already exceeding the top end of our 10-20% FY 2016 well cost reduction target
    • Decreased drilling time to an average of 16 days in FY 2015 as a result of high grading drilling rig fleet and pad drilling efficiencies
    • 84% of approximately 83,000 net core acres held by production as of fiscal year-end 2015
  • Successful Bakken down spacing program across our core acreage supported an increase in gross operated remaining drilling inventory to 673 locations assuming 8 Bakken (up from 6) and 4 Three Forks wells per drilling spacing unit (DSU); further evaluation and testing of Three Forks down spacing ongoing 
  • As of January, 31 2015, approximately 90% of operated producing wells were connected to gas sales and 91% were connected to oil gathering infrastructure
  • Reduced lease operating expense (LOE) to $6.15/boe (-18% y/y) in FY 2015 from $7.49/boe in FY 2014
  • RockPile generated $418.1 million (+116% y/y) of stand-alone revenue in FY 2015 ($288.5 million of consolidated revenue) as compared to $193.6 million in FY 2014 ($98.2 million of consolidated revenue).  In Q4 2015, RockPile generated $111.1 million (+97% y/y) of stand-alone revenue as compared to $56.5 million in Q4 2014
    • Increased year-over-year completions by 83%, completing 49 Triangle operated wells and 99 third-party wells in FY 2015 as compared to 31 Triangle operated wells and 50 third-party wells in FY 2014
    • Backlog of 39 wells, including 37 for third-party operators, at the end of February 2015
    • In FY 2015, RockPile paid total distributions of $89 million (95% cash) to Triangle

Q4 Fiscal Year 2015 and Fiscal Year 2015 Summary Consolidated Statement of Operations (in thousands)








Three Months Ended January 31,

Year Ended January 31,






2015

2014

2015

2014

Revenues











Oil, natural gas and natural gas liquids sales

$    63,023

$    49,372

$    284,502

$    160,548

Oilfield services(a)



93,965

$    36,138

288,453

98,199

Total Revenues



156,988

85,510

572,955

258,747

Expenses











Lease operating expenses

6,962

4,965

25,703

14,454

Gathering, transportation and processing

6,605

2,753

18,520

4,302

Production taxes

6,112

5,482

29,774

18,006

Depreciation and amortization

43,590

21,011

124,055

58,011

Accretion of asset retirement obligations

(157)

(944)

167

56

Oilfield services(a)

74,475

29,285

216,596

82,327

Corporate and other stock-based compensation

1,808

1,978

6,255

6,113

E&P stock-based compensation

323

230

1,155

1,127

RockPile stock-based compensation

146

132

509

590

Corporate and other cash G&A expenses

4,878

2,837

14,550

8,203

E&P cash G&A expenses

3,484

1,739

13,736

7,480

RockPile cash G&A expenses

7,560

3,541

25,218

11,116

System conversion costs

-

-

1,334

-

Total operating expenses

155,786

73,009

477,572

211,785













Operating Income



1,202

12,501

95,383

46,962













Interest expense, net


(9,164)

(1,698)

(25,100)

(7,132)

Amortization of deferrred loan costs

(1,372)

(554)

(3,149)

(554)

Gain on extinguishment of debt

6,610

-

6,610

-

Commodity derivatives gains (losses)

50,605

2,146

64,050

1,082

Equity investment income (loss)

(376)

-

81

-

Gain (loss) on equity investment derivatives

(3,109)

3,953

553

39,785

Other income



360

(126)

469

1,278

Total other income



43,553

3,720

43,514

34,459













Net Income Before Income Taxes

44,755

16,221

138,897

81,421

Income tax provision(b)

5,850

1,972

45,500

7,941

Net Income



$    38,905

$    14,249

$      93,397

$      73,480













Net Income per Common Share







Basic




$        0.50

$        0.17

$          1.12

$          1.07

Diluted(c)



$        0.42

$        0.15

$          0.97

$          0.91













Adjusted Net Income per Common Share(d)






Basic




$        0.06

$        0.12

$          0.65

$          0.55

Diluted(c)



$        0.06

$        0.11

$          0.58

$          0.48













Weighted Average Common Shares






Basic




77,207

85,677

83,611

68,579

Diluted




94,857

102,757

101,032

84,558

(a) Includes intercompany eliminations; reference Note 3 – Segment Reporting in our fiscal year 2015 Form 10-K for additional details

(b) The effective tax rate for the three months and year ended January 31, 2015 is approximately 13% and 33%, respectively, which differs from the statutory income tax rate due to permanent book to tax differences. Income tax provision is a non-cash expense

(c) Includes interest expense add-back of $1.0 million and $4.1 million net of income taxes and amounts capitalized for the 3 months and year ended January 31, 2015, respectively,  related to outstanding convertible note

(d) Reference accompanying Reconciliation Tables and Use of Segment Information and Non-GAAP Measures at end of press release for additional detail


Use of Segment Information and Non-GAAP Measures


(1)

The Company often provides financial metrics for Triangle's segments of operation. Revenues for each segment are disclosed in notes to the financial statements contained in the Company's Form 10-K and Form 10-Q filings, but the sum of those stand-alone revenues differ from Triangle's consolidated revenues for the corresponding reporting period. Triangle's consolidated revenues would reflect segment revenues reduced for intercompany sales (i.e. for RockPile services to Triangle's E&P segment).




Triangle also believes that stand-alone segment revenue assists investors in measuring RockPile's performance as a stand-alone company without eliminating, on a consolidated basis, certain revenues attributable to services for Triangle's economic interests in wells operated by Triangle's E&P segment. 



(2)

Adjusted-EBITDA represents income before interest expense, income taxes, depreciation and amortization, other non-cash items, and non-recurring items. Adjusted-EBITDA is not a calculation based upon generally accepted accounting principles in the U.S. ("GAAP"). Triangle has presented Adjusted-EBITDA by segment because it regularly reviews Adjusted-EBITDA by segment as a measure of the segment's operating performance. Triangle also believes Adjusted-EBITDA assists investors in comparing segment performance on a consistent basis without regard to interest expense, income taxes, depreciation and amortization, other non-cash items, and non-recurring items which can vary significantly depending upon many factors. 




The total of Adjusted-EBITDA by segment is not indicative of Triangle's consolidated Adjusted-EBITDA, which reflects other matters such as (i) additional parent company administrative costs, (ii) intercompany eliminations, (iii) paid-in-kind interest expense on the convertible notes, and (iv) the use of the equity method, rather than consolidation, for Triangle's investment in Caliber.  The Adjusted-EBITDA measures presented in the "Reconciliation Tables" may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation.



Triangle believes that net income before income taxes is the performance measure calculated and presented in accordance with GAAP that is most directly comparable to Adjusted-EBITDA. Net income before income taxes will be significantly affected by consolidated interest expense and full-cost pool amortization. Such amortization varies with changes in proved reserves, well costs during the year, and future plans in developing proved undeveloped reserves.


(3)

Adjusted net income (loss) is defined as net income (loss) applicable to common stockholders adjusted to exclude certain charges or amounts in order to provide users of this financial information with additional meaningful comparisons between current results and the results of prior periods. Triangle presents this measure because (i) it is consistent with the manner in which the Company's performance is measured relative to the performance of its peers, (ii) this measure is more comparable to earnings estimates provided by securities analysts, and (iii) charges or amounts excluded cannot be reasonably estimated and guidance provided by the Company excludes information regarding these types of items. These adjusted amounts are not a measure of financial performance under GAAP. We believe that net income (loss) is the performance measure calculated and presented in accordance with GAAP that is most directly comparable to adjusted net income (loss).

About Triangle

Triangle (NYSE MKT: TPLM) is an independent energy company with a strategic focus on developing the Bakken Shale and Three Forks formations in the Williston Basin of North Dakota and Montana.  For more information, visit Triangle's website at www.trianglepetroleum.com.

Conference Call Information

As previously announced, Triangle will host a conference call Tuesday, April 14, 2015 at 8:30 AM MT (10:30 AM ET) to provide an operational update and financial results of Triangle's fourth quarter and full fiscal year 2015, followed immediately by a question and answer session. A live webcast of the conference call can be accessed by visiting the following link: http://www.videonewswire.com/event.asp?id=101935 or interested parties may dial-in using the conference call number (888) 347-6610. International parties may dial-in using (412) 902-4292. A recording of the conference call will be available through April 23, 2015 at (877) 344-7529 (conference # 10062769). For international participants, the replay dial-in number is (412) 317-0088 (conference # 10062769).

Fiscal Year 2015 Segment Income and Elimination (in thousands)



Exploration and
Production

Oilfield
Services

Corporate
and Other(a)

Eliminations and Other

Consolidated Total

Revenues













Oil, natural gas and natural gas liquids sales

$

284,502

$

-

$

-

$

-

$

284,502

Oilfield services for third parties

-

294,526

-

(6,073)

288,453

Intersegment revenues

-

123,577

-

(123,577)

-

Total Revenues

284,502

418,103

-

(129,650)

572,955















Expenses













LOE, GTP, Production Taxes and other expenses

74,164

-

-

-

74,164

Depreciation and amortization

116,633

22,008

921

(15,507)

124,055

Cost of oilfield services

-

301,142

308

(84,854)

216,596

General and administrative

16,225

25,727

20,805

-

62,757

Total operating expenses

207,022

348,877

22,034

(100,361)

477,572















Operating Income

77,480

69,226

(22,034)

(29,289)

95,383

Other income (expense), net

51,216

(3,024)

(2,356)

(2,322)

43,514

Net Income (Loss) Before Income Taxes

$

128,696

$

66,202

$

(24,390)

$

(31,611)

(b)

$

138,897















(a) Corporate and Other includes Triangle's corporate office and several subsidiaries that management does not consider to be part of the exploration and production or oilfield services segments. Also included are results from Triangle's investment in Caliber, including any changes in the fair value of equity investment derivatives. Other than Caliber, these subsidiaries have limited activity

(b) $31.6 million RockPile, Caliber, and other services consolidated elimination results in a $31.6 million reduction in oil and natural gas property expenditures.


*Reference Note 3 – Segment Reporting in our fiscal year 2015 Form 10-K for additional details

Q4 Fiscal Year 2015 Segment Income and Elimination (in thousands)

 


Exploration and Production

Oilfield    Services

Corporate and Other(a)

 Eliminations and Other

Consolidated Total

Revenues













Oil, natural gas and natural gas liquids sales

$

63,023

$

-

$

-

$

-

$

63,023

Oilfield services for third parties

-

94,066

-

(101)

93,965

Intersegment revenues

-

17,075

-

(17,075)

-

Total Revenues

63,023

111,141

-

(17,176)

156,988















Expenses













LOE, GTP, Production Taxes and other expenses

19,522

-

-

-

19,522

Depreciation and amortization

39,903

7,608

304

(4,225)

43,590

Cost of oilfield services

-

86,015

256

(11,796)

74,475

General and administrative

3,807

7,706

6,686

-

18,199

Total operating expenses

63,232

101,329

7,246

(16,021)

155,786















Operating Income

(209)

9,812

(7,246)

(1,155)

1,202

Other income (expense), net

49,789

(1,489)

(4,619)

(128)

43,553

Net Income (Loss) Before Income Taxes

$

49,580

$

8,323

$

(11,865)

$

(1,283)

(b)

$

44,755















(a) Corporate and Other includes Triangle's corporate office and several subsidiaries that management does not consider to be part of the exploration and production or oilfield services segments. Also included are results from Triangle's investment in Caliber, including any changes in the fair value of equity investment derivatives. Other than Caliber, these subsidiaries have limited activity

 

(b) $1.3 million RockPile, Caliber, and other services consolidated elimination results in a $1.3 million reduction in oil and natural gas property expenditures.

 

*Reference Note 3 – Segment Reporting in our fiscal year 2015 Form 10-K for additional details

Reconciliation Tables (in thousands)

 

a)    

Consolidated Adjusted net income (loss) per common stockholder (reference disclosure (3) in "Use of Segment Information and Non-GAAP Measures")






Q4 Fiscal 2015

Q4 Fiscal 2014

Fiscal 2015

Fiscal 2014

Net income attributable to common stockholders

$             38,905

$             14,249

$             93,397

$             73,480

(Gain) loss on equity investment derivatives

3,109

(3,953)

(553)

(39,785)

(Gain) loss on commodity derivatives

(50,605)

(2,146)

(64,050)

(1,082)

Realized gain (loss) on commodity derivatives

14,506

-

11,422

-

Other




(6,610)

1,972

(5,276)

932

Tax impact(a)



5,176

502

19,149

3,895

Adjusted Net Income



$               4,481

$             10,624

$             54,090

$             37,439













Adjusted Net Income Per Common Share








Basic




$                 0.06

$                 0.12

$                 0.65

$                 0.55

Diluted(b)



$                 0.06

$                 0.11

$                 0.58

$                 0.48













Weighted Average Common Shares








Basic




77,207

85,677

83,611

68,579

Diluted




94,857

102,757

101,032

84,558

(a) Tax impact is computed as pre tax-effected adjusting items multiplied by the Company's effective tax rate

 

(b) Includes interest expense add-back of $1.0 million and $4.1 million net of income taxes and amounts capitalized for the 3 months and year ended January 31, 2015, respectively, related to outstanding convertible note

b)

E&P stand-alone Adjusted-EBITDA (reference disclosure (1) and (2) in "Use of Segment Information and Non-GAAP Measures")  




Q4 Fiscal 2015

Fiscal 2015

Net Income (Loss) Before Income Taxes

$              49,580

$            128,696

Depreciation and amortization

39,903

116,633

Net interest expense

7,730

19,574

Stock-based compensation

323

1,155

Accretion of asset retirement obligations

(157)

167

Other

(7,049)

(5,406)

(Gain) loss on commodity derivatives

(50,605)

(64,050)

Realized gain (loss) on commodity derivatives

14,506

11,422

Adjusted-EBITDA

$              54,231

$            208,191

c)   

Oilfield Services stand-alone Adjusted-EBITDA (reference disclosure (1) and (2) in "Use of Segment Information and Non-GAAP Measures")







Q4 Fiscal 2015

Fiscal 2015

Net Income (Loss) Before Income Taxes

$                8,323

$              66,202

Depreciation and amortization

7,608

22,008

Stock-based compensation

146

509

Net interest expense

1,061

2,704

Other



776

3,720

Adjusted-EBITDA


$              17,914

$              95,143

*Oilfield Services Adjusted-EBITDA calculated per RockPile credit facility

Forward-Looking Statements Disclosure

The information presented in this press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements.  These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from the results contemplated by the forward-looking statements. Factors that could cause actual results to differ materially from the results contemplated by the forward-looking statements include, but are not limited to, the risks discussed in the Company's annual report on Form 10-K and its other filings with the Securities and Exchange Commission. The forward-looking statements in this press release are made as of the date of this press release, and the Company undertakes no obligation to update any forward-looking statement as a result of new information, future developments, or otherwise.

Contact

Triangle Petroleum Corporation
Joe Magner, Vice President, Capital Markets
303-260-7125
[email protected]

SOURCE Triangle Petroleum Corporation

Related Links

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