Bonanza Creek Energy Announces Third Quarter 2016 Financial And Operating Results

  • Third quarter production volumes averaged 21.0 MBoe per day, exceeding the midpoint of guidance by 5%
  • Improving operational efficiency resulted in the fifth consecutive quarter of reductions in Rockies LOE and midstream expense; Rockies upstream LOE of $4.09/Boe
  • GAAP cash provided by operating activities of $17.5 million; adjusted EBITDAX (1) of $25.1 million; GAAP net loss of $0.71 per diluted share; adjusted net loss (1) of $0.35 per diluted share
  • Updated 2016 guidance reflects increased production and reduced LOE and midstream expense 

(1) Non-GAAP measure, see attached Reconciliation Schedules.

DENVER, Nov. 09, 2016 (GLOBE NEWSWIRE) -- Bonanza Creek Energy, Inc. (NYSE:BCEI) (the "Company") today announces its third quarter 2016 financial and operating results.

Third Quarter 2016 Results

For the third quarter of 2016, the Company reported average daily production of 21.0 MBoe per day, a 10% sequential decrease from the second quarter of 2016, and a 28% decrease from the third quarter of 2015. The reduction in production volumes is a result of suspended drilling and completion operations at the end of the first quarter of 2016. Product mix for the third quarter of 2016 was 52% oil, 22% NGLs, and 26% natural gas.

Net revenue for the third quarter of 2016 was $49.3 million, a 10% sequential decrease from the second quarter of 2016 and a 32% decrease from the third quarter of 2015. Crude oil accounted for approximately 77% of total revenue. Differentials for the Company's Rocky Mountain oil production during the quarter averaged approximately $9.64 per Bbl. Average realized prices for the third quarter of 2016 are presented below.
Average Realized Prices
  Three Months Ended September 30, 2016
  Before Derivatives   After Derivatives
Oil (per Bbl) (1) 37.45     41.74  
Gas (per Mcf) (2) 2.31     2.31  
NGL (per Bbl) 10.80     10.80  
Boe (Per Boe) 25.57     27.83  
(1) Crude oil sales includes $104,000 and $46,000 of oil transportation revenues from third parties, which do not have associated sales volumes, for the three months ended September 30, 2016 and 2015, respectively.
(2) Natural gas sales includes $381,000 and $291,000 of gas gathering revenues from third parties, which do not have associated sales volumes, for the three months ended September 30, 2016 and 2015, respectively.

The Company's Rocky Mountain region has lowered its cost structure significantly on a sequential basis by reducing its LOE and midstream operating expense by $2.3 million and $0.3 million, respectively, from the second quarter of 2016. Rockies LOE and midstream expense for the third quarter of 2016 was $6.4 million and $1.2 million, respectively. Total Company LOE for the third quarter of 2016 was $9.9 million, or $5.13 per Boe, compared to $10.7 million, or $5.08 per Boe in the second quarter of 2016, and $17.2 million, or $6.44 per Boe in the third quarter of 2015. The Company continues to execute on cost saving initiatives resulting in a 20% year over year reduction in per unit LOE in a period of declining production.  Below is a breakout of the Company's regional LOE and gas plant and midstream operating expense for the third quarter of 2016.
Lease Operating Expense
  Three Months Ended September 30, 2016
  Rocky Mountain   Mid-Continent   Total Company
  ($M)   ($/Boe)   ($M)   ($/Boe)   ($M)   ($/Boe)
LOE $ 6,403     $ 4.09     $ 3,490     $ 9.61     $ 9,893     $ 5.13  
Gas plant and midstream operating expense 1,237     0.79     1,637     4.51     2,874     1.49  
Total $ 7,640     $ 4.88     $ 5,127     $ 14.12     $ 12,767     $ 6.62  

Recurring cash general and administrative ("G&A") expense, which excludes stock compensation and advisor fees, for the third quarter of 2016 was $10.9 million, or $5.65 per Boe. This compares to recurring cash G&A expense of $10.9 million, or $5.13 per Boe in the second quarter of 2016, and $13.5 million, or $5.07 per Boe in the third quarter of 2015. Total G&A expense for the third quarter of 2016 was $18.7 million, or $9.68 per Boe. This compares to G&A expense of $17.8 million, or $6.69 per Boe in the third quarter of 2015 and $13.2 million, or $6.26 per Boe in the second quarter of 2016. Total G&A expense has increased sequentially by 41% from the second quarter of 2016, and has increased by 5% from the third quarter of 2015. The increase to G&A during the third quarter of 2016 was a result of advisor fees incurred in connection with the Company's evaluation of certain financing alternatives of $5.9 million.

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