1st Sep 2014 10:04
LONDON (Alliance News) - Edge Resources Inc Monday said it swung to a profit in the first quarter of its financial year, although it warned that price falls will hit near-term results, and it said its capital programme will be balanced between existing projects and acquisitions.
Its net profit was CAD288,431 in the three months to June 230, compared with a CAD30,768 loss a year earlier, as revenue, net of royalties, rose to CAD2.8 million, from CAD2.0 million. It said the net profit figure was a record.
"Subsequent commodity price decreases and ordinary production declines will impact the company's ability to generate similar future financial results in the near term," it warned.
The oil and gas exploration, development & production company said sales were CAD3.5 million for the three months ended June 30 compared to CAD2.3 million in the second quarter of 2013.
Edge said production in the quarter averaged 613 barrels of oil equivalent per day, compared to 577 barrels of oil equivalent per day in the first quarter of 2013. Quarterly oil netbacks also improved 37% compared to the previous quarter to CAD49.14 per oilfield barrel.
The company secured a new debt facility of up to CAD17 million with ATB Corporate Financial Services, replacing the previous facility of CAD8 million at a reduced interest rate, currently 4.75% per annum. "This has drastically reduced the company's cost of capital and provides a larger pool of funds for future projects," it said.
"Our focus now is on implementation of our capital programme, which we expect will be conservative and balanced between acquisitions and drilling on our existing property." said Brad Nichol, president and chief executive.
"Any new projects we undertake must meet those very high hurdles in order to make our short-list. It's a fantastic problem to have and we look forward to implementing a capital programme in the near future" he added.
Edge Resources Inc shares were up 3.71% at 12.70 pence per share Monday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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