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|Stone Energy Corporation Announces Fourth Quarter and Year-End 2017 Results|
Interim Chief Executive Officer and President
For the quarter ended
Net daily production during the fourth quarter of 2017 averaged approximately 17.6 thousand barrels of oil equivalent ("MBoe") per day, compared to net daily production of approximately 19.2 MBoe per day for the quarter ended
Prices realized during the fourth quarter of 2017 averaged
Lease operating expenses ("LOE") during the fourth quarter of 2017 totaled approximately
Transportation, processing, and gathering ("TP&G") expenses during the fourth quarter of 2017 totaled approximately
Depreciation, depletion, and amortization ("DD&A") expense on oil and gas properties for the fourth quarter of 2017 totaled approximately
Salaries, general, and administrative ("SG&A") expenses (exclusive of incentive compensation) for the fourth quarter of 2017 were
Accretion expense for the fourth quarter of 2017 was approximately
Net derivative expense for the fourth quarter of 2017 totaled approximately
Interest expense for the fourth quarter of 2017 was approximately
Year-End 2017 Estimated Proved Reserves and Standardized Measure
Estimated proved reserves as of
The standardized measure of discounted future net cash flows from our estimated proved reserves at
All of Stone's year-end 2017 estimated proved, probable, and possible reserves were independently engineered by
2017 Capital Expenditure Update
Capital expenditures for the fourth quarter of 2017 were approximately
2018 Capital Expenditure Budget
Stone's Board of Directors has authorized a full-year 2018 capital expenditure budget of up to
We expect that cash flows from operating activities, cash on hand, and availability under our revolving credit facility will be adequate to meet the current 2018 operating and capital expenditure needs of the Company.
As previously announced, on
Completion of the Transaction is subject to the approval of Stone stockholders, the consummation of a tender offer and consent solicitation for Stone's 7.50% Senior Second Lien Notes due 2022, certain regulatory approvals, and other customary conditions.
The Transaction is expected to close in the second quarter of 2018.
The above is a summary of the material terms of the Transaction. This summary highlights only certain substantive provisions of the Transaction and is not intended to be a complete description of the Transaction. This summary is qualified in its entirety by reference to the Sailfish Energy Holdings Corporation Registration Statement on Form S-4 filed with the
Fresh Start Accounting and Hedge Accounting Changes
Upon emergence from Chapter 11 reorganization, Stone adopted fresh start accounting effective
The following table illustrates our derivative positions for 2018 and 2019 as of
Stone will not be hosting a conference call to discuss the fourth quarter and full year 2017 operational and financial results.
Non-GAAP Financial Measure
In this press release, we refer to a non-GAAP financial measure we call "discretionary cash flow". Discretionary cash flow equals cash flows from operating activities before changes in operating assets and liabilities. Management believes discretionary cash flow is a financial indicator of our company's ability to internally fund capital expenditures and service debt. Management also believes this non-GAAP financial measure of cash flow is useful information to investors because it is widely used by professional research analysts in the valuation, comparison, rating, and investment recommendations of companies in the oil and gas exploration and production industry. Discretionary cash flow should not be considered an alternative to net cash provided by (used in) operating activities or net income (loss), as defined by GAAP. See the "Reconciliation of Non-GAAP Financial Measure" schedules for reconciliations of discretionary cash flow to net cash provided by (used in) operating activities.
Certain statements in this press release are forward-looking and are based upon Stone's current belief as to the outcome and timing of future events. All statements, other than statements of historical facts, that address activities or results that Stone plans, expects, believes, projects, estimates, or anticipates will, should, or may occur in the future, including future production of oil and gas, future capital expenditures and drilling and completion of wells, and future financial or operating results are forward-looking statements. All forward-looking numbers are approximate. Important factors that could cause actual results to differ materially from those in the forward-looking statements herein include, but are not limited to, the timing, extent, and volatility of changes in commodity prices for oil and gas; operating risks; liquidity risks, including risks relating to our bank credit facility and the Company's ability to access the capital markets; political and regulatory developments and legislation, including developments and legislation relating to our operations in the Gulf of
Estimates for Stone's future production volumes are based on assumptions of capital expenditure levels and the assumption that market demand and prices for oil and gas will continue at levels that allow for economic production of these products. The production, transportation, and marketing of oil and gas are subject to disruption due to transportation and processing availability, mechanical failure, human error, hurricanes, and numerous other factors. Stone's estimates are based on certain other assumptions, such as well performance and uptime estimates, which may vary significantly from those assumed. Delays experienced in well permitting could affect the timing of drilling and production. Lease operating expenses, which include major maintenance costs, vary in response to changes in prices of services and materials used in the operation of our properties, and the amount of maintenance activity required. Estimates of DD&A rates can vary according to reserve additions, capital expenditures, future development costs, and other factors. Therefore, we can give no assurance that our future production volumes, lease operating expenses, or DD&A rates, if provided, will be as estimated.
Important Additional Information
In connection with the Transaction,
No Offer or Solicitation
This communication is for informational purposes only and is not intended to and does not constitute an offer to subscribe for, buy or sell, the solicitation of an offer to subscribe for, buy or sell or an invitation to subscribe for, buy or sell any securities or the solicitation of any vote or approval in any jurisdiction pursuant to or in connection with the Transaction or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, and otherwise in accordance with applicable law.
Participants in the Solicitation
Talos, Stone, Newco and certain of their respective directors, executive officers and members of management and employees may be deemed to be participants in the solicitation of written consents in respect of the Transaction. Information regarding Stone's directors and executive officers is set forth in Stone's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Information regarding Talos's directors and executive officers and more detailed information regarding the identity of all potential participants, and their direct and indirect interests, by security holdings or otherwise, is set forth in the consent solicitation/prospectus and other relevant materials filed with the
Stone Energy is an independent oil and natural gas exploration and production company headquartered in Lafayette, Louisiana with an additional office in New Orleans. Stone is engaged in the acquisition, exploration, development, and production of properties in the Gulf of
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