Quarterly / Earnings Reports | Third Quarter (3Q) Update | Financial Results | Capital Markets

Synergy Reports 3Q Results; Loss, Production Growth

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   |    Thursday,July 09,2015

Synergy Resources Corporation reported its fiscal third quarter results for the period ended May 31, 2015.

Third Quarter 2015 Financial Results:

• Revenues for the fiscal 2015 third quarter increased 1.4% to $26.0 million from $25.7 million in the same quarter a year ago. The year-over-year improvement was the result of a 95% increase in production, primarily from the new horizontal wells brought on line and production from acquisitions and asset swaps with other operators. Revenue growth was offset by a 48% decrease in the realized average selling price per BOE. During fiscal Q3 2015, average selling prices were $45.77 per barrel of oil and $3.16 per mcf of gas compared to $90.91 and $5.15, respectively, a year ago.
• Net loss of $2.5 million or $0.2 per basic and diluted share is inclusive of a $3 million full cost ceiling impairment charge resulting from lower oil and gas prices. This compares with net income of $7.2 million, or $0.09 per basic and diluted share in the third fiscal quarter of 2014.
• Adjusted EBITDA (a non-GAAP metric) increased 31% to $24.9 million up from $18.9 million a year ago.
• At May 31, 2015, cash and cash equivalents totaled $190.2 million. Borrowings under the credit facility were $141.0 million.

Third Quarter 2015 Highlights:

• Net oil and natural gas production increased to 738,357 barrels of oil equivalent (BOE), averaging 8,026 BOE per day, compared to 379,081 BOE, or an average of 4,120 BOE per day, in the same quarter one year ago, an average daily increase of 95%.
• Operated 52 gross producing horizontal wells in the Wattenberg Field as of May 31^st, 2015.
• 28 additional operated horizontal wells were awaiting completion and 4 more operated horizontal wells were in the drilling process as of May 31, 2015.

William Scaff, co-CEO of Synergy, commented, "This quarter's financial results reflect the efficiencies we are achieving as we generated a 68% operating cash margin on revenues in the quarter, even while our realized commodity prices were nearly 50% lower than a year ago. At the same time, we almost doubled our production compared to the year ago quarter as we continued the horizontal development of our assets in the Wattenberg Field. With our operating efficiencies, cash on our balance sheet and remaining liquidity on credit facility we believe our estimated $250-$300 million fiscal 2016 capital budget is fully funded and will generate production growth of over 50% compared to fiscal 2015."

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