General Announcement::Canacol Energy Ltd. Reports an 11% Increase in Netback

Issuer & Securities

Issuer/ Manager
CANACOL ENERGY LTD.
Securities
CANACOLENE US$500M5.75%281124A - US134808AD63 - PNTB
CANACOLENE US$500M5.75%281124R - USU13518AC64 - YW0B
Stapled Security
No

Announcement Details

Announcement Title
General Announcement
Date &Time of Broadcast
10-Nov-2023 06:10:30
Status
New
Announcement Sub Title
Canacol Energy Ltd. Reports an 11% Increase in Netback
Announcement Reference
SG231110OTHRKALQ
Submitted By (Co./ Ind. Name)
Canacol Energy Ltd.
Designation
SGX-SE
Description (Please provide a detailed description of the event in the box below)
Canacol Energy Ltd. Reports an 11% Increase in Netback and an Adjusted EBITDAX of $62 million in Q3 2023

CALGARY, ALBERTA - (November 9, 2023) - Canacol Energy Ltd. ( Canacol or the Corporation ) (TSX:CNE; OTCQX:CNNEF; BVC:CNEC) is pleased to report its financial and operating results for the three and nine months ended September 30, 2023. Dollar amounts are expressed in United States dollars, with the exception of Canadian dollar unit prices ( C$ ) where indicated and otherwise noted.

Highlights for the three and nine months ended September 30, 2023

Adjusted EBITDAX increased 11% and 14% to $62.1 million and $183.7 million for the three and nine months ended September 30, 2023, respectively, compared to $56 million and $160.8 million for the same periods in 2022, respectively.

The Corporation s natural gas and LNG operating netback increased 11% and 10% to $4.14 per Mcf and $4.03 per Mcf, for the three and nine months ended September 30, 2023, respectively, compared to $3.73 per Mcf and $3.66 per Mcf for the same periods in 2022, respectively. The increase is mainly due to an increase in average sales prices, net of transportation expenses, offset by an increase in operating expenses and royalties.

Total revenues, net of royalties and transportation expenses for the three and nine months ended September 30, 2023 both increased 9% to $76.6 million and $225.1 million, respectively, compared to $70.1 million and $206.3 million for the same periods in 2022, respectively, mainly due to higher average sales price, net of transportation expenses.
Adjusted funds from operations increased 26% and 3% to $49 million and $115.3 million for the three and nine months ended September 30, 2023, respectively, compared to $38.7 million and $111.6 million for the same periods in 2022, respectively, mainly due to an increase in EBITDAX.

Realized contractual natural gas sales volume decreased 3% and 1% to 178.2 MMcfpd and 182.8 MMcfpd for the three and nine months ended September 30, 2023, respectively, compared to 184.2 MMcfpd and 184.7 MMcfpd for the same periods in 2022, respectively. The decrease is due to the unusual and unexpected temporary decrease in the Corporation s production capacity.

The Corporation realized a net loss of $0.5 million and net income of $56.3 million for the three and nine months ended September 30, 2023, respectively, compared to a net loss of $4.5 million and a net income of $13.6 million for the same periods in 2022, respectively.

Net cash capital expenditures for the three and nine months ended September 30, 2023 were $43.8 million and $142.9 million, respectively.

As at September 30, 2023, the Corporation had $48.3 million in cash and cash equivalents and $4.4 million in working capital deficit.

Outlook
For the remainder of 2023, the Corporation is focused on 1) completing its development drilling program with the Nelson-16 and Pandereta-10 wells targeting productive sandstones of the CDO reservoir which it expects will restore productive capacity beyond the approximately 185 MMcfpd that exists today, 2) advancing the Macao 3D seismic program on the VIM-5 block which is targeted for completion in January of 2024, 3) contracting a 3,000 horsepower drilling rig in order to drill the Pola-1 exploration well in the Middle Magdalena Valley basin in the first half of 2024, and 4) working towards the execution of a fourth production contract in Bolivia.

The Corporation s original 2023 EBITDA guidance was a range of $190 million to $263 million. As the first nine months of 2023 EBITDA totaled $184 million, and with anticipated favorable pricing due to El Nino for the remainder of the year, the Corporation expects to be near the upper end of its guidance.

Attachments

09.11.2023 - Canacol Energy Ltd. Reports Q3 2023.pdf
Total size =276K