Yoqne`am `illit, Israel
Yoqne`am `illit, Israel
SEARCH FILTERS
Time filter
Source Type

News Article | May 9, 2017
Site: globenewswire.com

ENGLEWOOD, Colo., May 09, 2017 (GLOBE NEWSWIRE) -- Gevo, Inc. (NASDAQ:GEVO) today announced financial results for the quarter ended March 31, 2017. Key highlights for the first quarter of 2017 and key subsequent events included: Gevo produced approximately 100,000 gallons of isobutanol at its Luverne Facility during the first quarter of 2017. Consistent with Gevo’s previous isobutanol production guidance, production this quarter was focused on producing sufficient quantities of isobutanol to meet immediate customer demand while also providing enough inventory to support additional market and customer development efforts in the future. Gevo’s production goals are not to maximize production, but rather to align such production with its isobutanol sales efforts. As a result, during certain periods of the first quarter of 2017, Gevo only produced ethanol at the Luverne Facility, and in the second quarter of 2017, Gevo may elect to produce only ethanol. In the first quarter, Gevo’s isobutanol market development efforts were focused on gaining market acceptance in its core gasoline blendstock markets such as marinas and on-road gasoline fueling stations, while maintaining its targeted selling price. Gevo continued to work with its distribution partners to make investments to develop end-customer relationships, as well as to establish value chains to deliver its isobutanol to those end-customers. Gevo’s market development efforts related to its renewable hydrocarbon products were mainly targeted towards entering into binding supply agreements to underpin the economics of the proposed expansion of the Luverne Facility. Gevo has been in discussions with numerous potential alcohol-to-jet fuel (ATJ) and isooctane customers to enter into long term supply agreements, with a goal in 2017 of signing contracts representing the majority of the isobutanol production volumes to be produced at the expanded Luverne Facility. In April 2017, as noted above, Gevo entered into its first long term supply agreement with HCS, which Gevo estimates would represent approximately 10-15% of the isooctane production from an expanded Agri-Energy Facility. As Gevo develops markets for its products, there will likely be a mismatch in timing between isobutanol production and sales. As a result, at times Gevo will likely build isobutanol inventory levels.  At March 31, 2017, Gevo had approximately 288,000 gallons of isobutanol and approximately 52,000 gallons of renewable hydrocarbons in inventory. "During our year end update, we set out a number of key strategic initiatives and I am proud to say that we have made meaningful progress towards those goals. So far in 2017 we have significantly improved our balance sheet, as well as signed the exchange agreement with Whitebox that will extend the maturity of our senior debt, assuming a positive stockholder vote in June. This will provide us with additional time to pursue our strategy moving forward. As I have communicated many times, we had to clear this critical financial hurdle before we could more effectively drive customer development and better execute on our long-term expansion plan." said Dr. Patrick Gruber, Gevo’s Chief Executive Officer. Mr. Gruber continued, "As a reminder, our objective is to sell at least 50% of the capacity at the expanded Luverne facility. Although we still have significant work ahead of us, we are excited by the definitive supply agreement with HCS which is a key first step in achieving our targets. The entire Gevo organization is intensely focused on continuing our momentum throughout 2017 and beyond.” Revenues for the first quarter of 2017 were $5.6 million compared with $6.3 million in the same period in 2016. During the first quarter of 2017, revenues derived at the Luverne Facility related to ethanol sales and related products were $5.5 million, a decrease of approximately $0.3 million from the same period in 2016. This was primarily a result of lower ethanol production and distiller grain prices in the first quarter of 2017 versus the same period in 2016. During the first quarter of 2017, hydrocarbon revenues were $0.1 million, $0.2 million lower than the same period in 2016. Gevo’s hydrocarbon revenues are comprised of sales of ATJ, isooctane and isooctene. Gevo generated grant and other revenue of $32,000 during the first quarter of 2017, down $0.2 million as compared to the same period in 2016, mainly as a result of Gevo’s contract with the Northwest Advanced Renewables Alliances ending in 2016. Cost of goods sold was $9.4 million for the three months ended March 31, 2017, compared with $9.2 million in the same period in 2016. Cost of goods sold included approximately $7.9 million associated with the production of ethanol, isobutanol and related products and approximately $1.5 million in depreciation expense. Gross loss was $3.8 million for the three months ended March 31, 2017, versus $2.9 million in the same quarter in 2016. Research and development expense increased by $0.2 million during the three months ended March 31, 2017, compared with the same period in 2016, due primarily to an increase in employee-related expenses. Selling, general and administrative expense increased by $0.3 million during the three months ended March 31, 2017, compared with the same period in 2016, due primarily an increase in employee-related expenses. Loss from operations in the three months ended March 31, 2017 was $7.2 million, compared with $5.9 million in the same period in 2016. Non-GAAP cash EBITDA loss in the three months ended March 31, 2017 was $5.4 million, compared with $3.9 million in the same period in 2016. Interest expense in the three months ended March 31, 2017 was $0.7 million, down $1.4 million as compared to the same period in 2016, due to a decrease in outstanding principal balances of our debt. During the three months ended March 31, 2017, there was no change in the value of the embedded derivatives in the 2022 Notes, as the derivatives have had no meaningful value since the third quarter of 2014.  However, Gevo did incur a non-cash loss of $1.0 million in the quarter as a result of exchanging an aggregate of $8.4 million principal amount of the 2022 Notes for shares of Gevo’s common stock in January 2017. During the three months ended March 31, 2017, Gevo also incurred a non-cash loss of $0.3 million during the quarter due to the quarterly mark-to-market valuation of the 2017 Notes. During the three months ended March 31, 2017, the estimated fair value of the derivative warrant liability decreased by $3.3 million, resulting in a non-cash gain from a change in the fair value of derivative warrant liability. The net loss for the three months ended March 31, 2017 was $5.9 million, compared with $3.6 million during the same period in 2016. The non-GAAP adjusted net loss for the three months ended March 31, 2017 was $7.9 million, compared with $8.0 million during the same period in 2016. The cash position at March 31, 2017 was $20.4 million and the total principal face value of the debt outstanding was $17.7 million. Hosting today’s conference call at 4:30 p.m. EST (2:30 p.m. MST) will be Dr. Patrick Gruber, Chief Executive Officer, Mike Willis, Chief Financial Officer, and Geoff Williams, General Counsel. They will review Gevo’s financial results and provide an update on recent corporate highlights. To participate in the conference call, please dial 1(888) 771-4371 (inside the U.S.) or 1 (847) 585-4405 (outside the U.S.) and reference the access code 44704548. A replay of the call and webcast will be available two hours after the conference call ends on May 9, 2017. To access the replay, please dial 1-888-843-7419 (inside the US) or 1-630-652-3042  (outside the US) and reference the access code 44704548#. The archived webcast will be available in the Investor Relations section of Gevo's website at www.gevo.com. Gevo is a renewable technology, chemical products, and next generation biofuels company. Gevo has developed proprietary technology that uses a combination of synthetic biology, metabolic engineering, chemistry and chemical engineering to focus primarily on the production of isobutanol, as well as related products from renewable feedstocks. Gevo’s strategy is to commercialize biobased alternatives to petroleum-based products to allow for the optimization of fermentation facilities’ assets, with the ultimate goal of maximizing cash flows from the operation of those assets. Gevo produces isobutanol, ethanol and high-value animal feed at its fermentation plant in Luverne, Minnesota. Gevo has also developed technology to produce hydrocarbon products from renewable alcohols. Gevo currently operates a biorefinery in Silsbee, Texas, in collaboration with South Hampton Resources Inc., to produce ATJ, octane, and ingredients for plastics like polyester. Gevo has a marquee list of partners including The Coca-Cola Company, Toray Industries Inc. and Total SA, among others. Gevo is committed to a sustainable bio-based economy that meets society’s needs for plentiful food and clean air and water. Certain statements in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to a variety of matters, including, without limitation, statements related to the ability of Gevo to develop markets for its products, Gevo’s ability to enter into binding offtake, sales or supply agreements for its products, Gevo’s ability to produce isobutanol or related hydrocarbon products at its Luverne Facility, Gevo’s ability to finance, construct and operate the contemplated expanded Luverne Facility, Gevo’s 2017 operational and financial targets and milestones, Gevo’s cash operating and financing expectations, the supply agreement with HCS Holding, stockholder approval of the Exchange and the issuance of the 2020 Notes, the Purchase Agreement, Gevo’s ability to secure new customer relationships across core markets, and other statements that are not purely statements of historical fact.  These forward-looking statements are made on the basis of the current beliefs, expectations and assumptions of the management of Gevo and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Gevo undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Gevo believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Gevo in general, see the risk disclosures in the Annual Report on Form 10-K of Gevo for the year ended December 31, 2016, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the U.S. Securities and Exchange Commission by Gevo. This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), including non-GAAP Cash EBITDA Loss and non-GAAP Adjusted Net Loss Per Share. Non-GAAP Cash EBITDA Loss excludes non-cash items such as depreciation and stock-based compensation. Non-GAAP Adjusted Net Loss Per Share excludes non-cash gains and/or losses recognized in the quarter due to the changes in the fair value of certain of Gevo’s financial instruments, such as warrants, convertible debt and embedded derivatives. Management believes these measures are useful to supplement its GAAP financial statements with this non-GAAP information because management uses such information internally for its operating, budgeting and financial planning purposes. These non-GAAP financial measures also facilitate management's internal comparisons to Gevo’s historical performance as well as comparisons to the operating results of other companies. In addition, Gevo believes these non-GAAP financial measures are useful to investors because they allow for greater transparency into the indicators used by management as a basis for its financial and operational decision making. Non-GAAP information is not prepared under a comprehensive set of accounting rules and therefore, should only be read in conjunction with financial information reported under U.S. GAAP when understanding Gevo’s operating performance. A reconciliation between GAAP and non-GAAP financial information is provided in the financial statement tables below. On December 21, 2016, our Board of Directors approved a reverse split of our common stock, par value $0.01, at a ratio of one-for-twenty.  This reverse stock split became effective on January 5, 2017 and, unless otherwise indicated, all share amounts, per share data, share prices, exercise prices and conversion rates set forth in this press release and the accompanying consolidated financial statements have, where applicable, been adjusted to reflect this reverse stock split. 1 Adjusted Net Loss Per Share is calculated by adding back non-cash gains and/or losses recognized in the quarter due to the changes in the fair value of certain of our financial instruments, such as warrants, convertible debt and embedded derivatives; a reconciliation of Adjusted Net Loss Per Share to GAAP net loss per share is provided in the financial statement tables following this release. 2 Cash EBITDA Loss is calculated by adding back depreciation and non-cash stock compensation to GAAP loss from operations; a reconciliation of Cash EBITDA Loss to GAAP loss from operations is provided in the financial statement tables following this release. Gevo, Inc. Condensed Consolidated Statements of Operations Information (Unaudited, in thousands, except share and per share amounts) Gevo, Inc. Reconciliation of GAAP to Non-GAAP Financial Information (Unaudited, in thousands)


News Article | May 9, 2017
Site: globenewswire.com

ENGLEWOOD, Colo., May 09, 2017 (GLOBE NEWSWIRE) -- Gevo, Inc. (NASDAQ:GEVO) today announced financial results for the quarter ended March 31, 2017. Key highlights for the first quarter of 2017 and key subsequent events included: Gevo produced approximately 100,000 gallons of isobutanol at its Luverne Facility during the first quarter of 2017. Consistent with Gevo’s previous isobutanol production guidance, production this quarter was focused on producing sufficient quantities of isobutanol to meet immediate customer demand while also providing enough inventory to support additional market and customer development efforts in the future. Gevo’s production goals are not to maximize production, but rather to align such production with its isobutanol sales efforts. As a result, during certain periods of the first quarter of 2017, Gevo only produced ethanol at the Luverne Facility, and in the second quarter of 2017, Gevo may elect to produce only ethanol. In the first quarter, Gevo’s isobutanol market development efforts were focused on gaining market acceptance in its core gasoline blendstock markets such as marinas and on-road gasoline fueling stations, while maintaining its targeted selling price. Gevo continued to work with its distribution partners to make investments to develop end-customer relationships, as well as to establish value chains to deliver its isobutanol to those end-customers. Gevo’s market development efforts related to its renewable hydrocarbon products were mainly targeted towards entering into binding supply agreements to underpin the economics of the proposed expansion of the Luverne Facility. Gevo has been in discussions with numerous potential alcohol-to-jet fuel (ATJ) and isooctane customers to enter into long term supply agreements, with a goal in 2017 of signing contracts representing the majority of the isobutanol production volumes to be produced at the expanded Luverne Facility. In April 2017, as noted above, Gevo entered into its first long term supply agreement with HCS, which Gevo estimates would represent approximately 10-15% of the isooctane production from an expanded Agri-Energy Facility. As Gevo develops markets for its products, there will likely be a mismatch in timing between isobutanol production and sales. As a result, at times Gevo will likely build isobutanol inventory levels.  At March 31, 2017, Gevo had approximately 288,000 gallons of isobutanol and approximately 52,000 gallons of renewable hydrocarbons in inventory. "During our year end update, we set out a number of key strategic initiatives and I am proud to say that we have made meaningful progress towards those goals. So far in 2017 we have significantly improved our balance sheet, as well as signed the exchange agreement with Whitebox that will extend the maturity of our senior debt, assuming a positive stockholder vote in June. This will provide us with additional time to pursue our strategy moving forward. As I have communicated many times, we had to clear this critical financial hurdle before we could more effectively drive customer development and better execute on our long-term expansion plan." said Dr. Patrick Gruber, Gevo’s Chief Executive Officer. Mr. Gruber continued, "As a reminder, our objective is to sell at least 50% of the capacity at the expanded Luverne facility. Although we still have significant work ahead of us, we are excited by the definitive supply agreement with HCS which is a key first step in achieving our targets. The entire Gevo organization is intensely focused on continuing our momentum throughout 2017 and beyond.” Revenues for the first quarter of 2017 were $5.6 million compared with $6.3 million in the same period in 2016. During the first quarter of 2017, revenues derived at the Luverne Facility related to ethanol sales and related products were $5.5 million, a decrease of approximately $0.3 million from the same period in 2016. This was primarily a result of lower ethanol production and distiller grain prices in the first quarter of 2017 versus the same period in 2016. During the first quarter of 2017, hydrocarbon revenues were $0.1 million, $0.2 million lower than the same period in 2016. Gevo’s hydrocarbon revenues are comprised of sales of ATJ, isooctane and isooctene. Gevo generated grant and other revenue of $32,000 during the first quarter of 2017, down $0.2 million as compared to the same period in 2016, mainly as a result of Gevo’s contract with the Northwest Advanced Renewables Alliances ending in 2016. Cost of goods sold was $9.4 million for the three months ended March 31, 2017, compared with $9.2 million in the same period in 2016. Cost of goods sold included approximately $7.9 million associated with the production of ethanol, isobutanol and related products and approximately $1.5 million in depreciation expense. Gross loss was $3.8 million for the three months ended March 31, 2017, versus $2.9 million in the same quarter in 2016. Research and development expense increased by $0.2 million during the three months ended March 31, 2017, compared with the same period in 2016, due primarily to an increase in employee-related expenses. Selling, general and administrative expense increased by $0.3 million during the three months ended March 31, 2017, compared with the same period in 2016, due primarily an increase in employee-related expenses. Loss from operations in the three months ended March 31, 2017 was $7.2 million, compared with $5.9 million in the same period in 2016. Non-GAAP cash EBITDA loss in the three months ended March 31, 2017 was $5.4 million, compared with $3.9 million in the same period in 2016. Interest expense in the three months ended March 31, 2017 was $0.7 million, down $1.4 million as compared to the same period in 2016, due to a decrease in outstanding principal balances of our debt. During the three months ended March 31, 2017, there was no change in the value of the embedded derivatives in the 2022 Notes, as the derivatives have had no meaningful value since the third quarter of 2014.  However, Gevo did incur a non-cash loss of $1.0 million in the quarter as a result of exchanging an aggregate of $8.4 million principal amount of the 2022 Notes for shares of Gevo’s common stock in January 2017. During the three months ended March 31, 2017, Gevo also incurred a non-cash loss of $0.3 million during the quarter due to the quarterly mark-to-market valuation of the 2017 Notes. During the three months ended March 31, 2017, the estimated fair value of the derivative warrant liability decreased by $3.3 million, resulting in a non-cash gain from a change in the fair value of derivative warrant liability. The net loss for the three months ended March 31, 2017 was $5.9 million, compared with $3.6 million during the same period in 2016. The non-GAAP adjusted net loss for the three months ended March 31, 2017 was $7.9 million, compared with $8.0 million during the same period in 2016. The cash position at March 31, 2017 was $20.4 million and the total principal face value of the debt outstanding was $17.7 million. Hosting today’s conference call at 4:30 p.m. EST (2:30 p.m. MST) will be Dr. Patrick Gruber, Chief Executive Officer, Mike Willis, Chief Financial Officer, and Geoff Williams, General Counsel. They will review Gevo’s financial results and provide an update on recent corporate highlights. To participate in the conference call, please dial 1(888) 771-4371 (inside the U.S.) or 1 (847) 585-4405 (outside the U.S.) and reference the access code 44704548. A replay of the call and webcast will be available two hours after the conference call ends on May 9, 2017. To access the replay, please dial 1-888-843-7419 (inside the US) or 1-630-652-3042  (outside the US) and reference the access code 44704548#. The archived webcast will be available in the Investor Relations section of Gevo's website at www.gevo.com. Gevo is a renewable technology, chemical products, and next generation biofuels company. Gevo has developed proprietary technology that uses a combination of synthetic biology, metabolic engineering, chemistry and chemical engineering to focus primarily on the production of isobutanol, as well as related products from renewable feedstocks. Gevo’s strategy is to commercialize biobased alternatives to petroleum-based products to allow for the optimization of fermentation facilities’ assets, with the ultimate goal of maximizing cash flows from the operation of those assets. Gevo produces isobutanol, ethanol and high-value animal feed at its fermentation plant in Luverne, Minnesota. Gevo has also developed technology to produce hydrocarbon products from renewable alcohols. Gevo currently operates a biorefinery in Silsbee, Texas, in collaboration with South Hampton Resources Inc., to produce ATJ, octane, and ingredients for plastics like polyester. Gevo has a marquee list of partners including The Coca-Cola Company, Toray Industries Inc. and Total SA, among others. Gevo is committed to a sustainable bio-based economy that meets society’s needs for plentiful food and clean air and water. Certain statements in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to a variety of matters, including, without limitation, statements related to the ability of Gevo to develop markets for its products, Gevo’s ability to enter into binding offtake, sales or supply agreements for its products, Gevo’s ability to produce isobutanol or related hydrocarbon products at its Luverne Facility, Gevo’s ability to finance, construct and operate the contemplated expanded Luverne Facility, Gevo’s 2017 operational and financial targets and milestones, Gevo’s cash operating and financing expectations, the supply agreement with HCS Holding, stockholder approval of the Exchange and the issuance of the 2020 Notes, the Purchase Agreement, Gevo’s ability to secure new customer relationships across core markets, and other statements that are not purely statements of historical fact.  These forward-looking statements are made on the basis of the current beliefs, expectations and assumptions of the management of Gevo and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Gevo undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Gevo believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Gevo in general, see the risk disclosures in the Annual Report on Form 10-K of Gevo for the year ended December 31, 2016, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the U.S. Securities and Exchange Commission by Gevo. This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), including non-GAAP Cash EBITDA Loss and non-GAAP Adjusted Net Loss Per Share. Non-GAAP Cash EBITDA Loss excludes non-cash items such as depreciation and stock-based compensation. Non-GAAP Adjusted Net Loss Per Share excludes non-cash gains and/or losses recognized in the quarter due to the changes in the fair value of certain of Gevo’s financial instruments, such as warrants, convertible debt and embedded derivatives. Management believes these measures are useful to supplement its GAAP financial statements with this non-GAAP information because management uses such information internally for its operating, budgeting and financial planning purposes. These non-GAAP financial measures also facilitate management's internal comparisons to Gevo’s historical performance as well as comparisons to the operating results of other companies. In addition, Gevo believes these non-GAAP financial measures are useful to investors because they allow for greater transparency into the indicators used by management as a basis for its financial and operational decision making. Non-GAAP information is not prepared under a comprehensive set of accounting rules and therefore, should only be read in conjunction with financial information reported under U.S. GAAP when understanding Gevo’s operating performance. A reconciliation between GAAP and non-GAAP financial information is provided in the financial statement tables below. On December 21, 2016, our Board of Directors approved a reverse split of our common stock, par value $0.01, at a ratio of one-for-twenty.  This reverse stock split became effective on January 5, 2017 and, unless otherwise indicated, all share amounts, per share data, share prices, exercise prices and conversion rates set forth in this press release and the accompanying consolidated financial statements have, where applicable, been adjusted to reflect this reverse stock split. 1 Adjusted Net Loss Per Share is calculated by adding back non-cash gains and/or losses recognized in the quarter due to the changes in the fair value of certain of our financial instruments, such as warrants, convertible debt and embedded derivatives; a reconciliation of Adjusted Net Loss Per Share to GAAP net loss per share is provided in the financial statement tables following this release. 2 Cash EBITDA Loss is calculated by adding back depreciation and non-cash stock compensation to GAAP loss from operations; a reconciliation of Cash EBITDA Loss to GAAP loss from operations is provided in the financial statement tables following this release. Gevo, Inc. Condensed Consolidated Statements of Operations Information (Unaudited, in thousands, except share and per share amounts) Gevo, Inc. Reconciliation of GAAP to Non-GAAP Financial Information (Unaudited, in thousands)


News Article | May 10, 2017
Site: globenewswire.com

SALT LAKE CITY, May 10, 2017 (GLOBE NEWSWIRE) -- LifeVantage Corporation (Nasdaq:LFVN) today reported financial results for its third quarter ended March 31, 2017. “We began to see the turn in sequential sales momentum as the third quarter progressed,” stated LifeVantage President and Chief Executive Officer Darren Jensen. “While sales were negatively impacted early in the quarter, we finished the third quarter with reaccelerating sales growth as we were finalizing the implementation of remedies relating to a recent review of international policies and procedures. We enter the fourth quarter with renewed business momentum and completed a successful global convention in April that included our rebranding of several key product lines, the introduction of product bundles that deliver greater value for customers and distributors, and integrated applications and technology solutions that were well received by distributors. Finally, we are progressing with plans to broaden our geographical footprint, and look forward to discussing specific activities to support this growth as the plan progresses.” Third Quarter Fiscal 2017 Results  For the third fiscal quarter ended March 31, 2017, the Company reported revenue of $45.0 million, a 19.9% decrease compared to $56.2 million for the comparable period in fiscal 2016. Year-over-year quarterly revenue reflects a decrease of 21.9% in the Americas and a 12.5% decrease in the Asia/Pacific & Europe region. Revenues in the Company’s United States and Hong Kong markets decreased for the third quarter of fiscal 2017 as the Company continued to take steps to help ensure that the Company’s products are not distributed or sold into countries without complying with applicable customs, tax and other regulatory requirements and to appropriately verify the residency of individuals who want to become independent distributors of the Company. Revenue for the third fiscal quarter ended March 31, 2017, was positively impacted $0.1 million, or 0.2%, by foreign currency fluctuations associated with revenue generated in several international markets. Gross profit for the third quarter of fiscal 2017 was $36.8 million, or 81.7% of revenue, compared to $46.4 million, or 82.7% of revenue, for the same period in fiscal 2016. Commissions and incentives expense for the third quarter of fiscal 2017 was $22.8 million, or 50.8% of revenue, compared to $28.2 million, or 50.2% of revenue, for the same period in fiscal 2016. Selling, general and administrative expense (SG&A) for the third quarter of fiscal 2017 was $13.7 million, or 30.5% of revenue, compared to $14.6 million, or 26.1% of revenue, in the comparable period of fiscal 2016. Operating income for the third quarter of fiscal 2017 was $0.2 million, compared to $3.6 million for the third quarter of fiscal 2016. Operating income during the third quarter of fiscal 2017 included approximately $0.6 million for expenses associated with executive severance, recruiting and transition expenses, and $0.1 million of class-action lawsuit expense. Operating income during the third quarter of fiscal 2016 included approximately $0.1 million of costs associated with executive team recruiting and transition expenses. Adjusted EBITDA was $1.6 million for the third quarter of fiscal 2017, compared to $5.1 million for the comparable period in fiscal 2016. Net income for the third quarter of fiscal 2017 was $0.1 million, or $0.00 per diluted share, calculated on 14.1 million fully diluted shares.  This compares to net income for the third quarter of fiscal 2016 of $1.0 million, or $0.07 per diluted share, calculated on 14.1 million fully diluted shares. Adjusted for net executive severance, recruiting and transition expenses of $0.3 million and class-action lawsuit expense of $0.1 million, all net of tax, adjusted Non-GAAP net income was $0.4 million for the third quarter of fiscal 2017, or $0.02 per diluted share; compared to $2.0 million, or $0.14 per diluted share for the comparable period of fiscal 2016. Non-GAAP adjustments to net income during the third quarter of fiscal 2016 included $0.1 million of executive team recruiting and transition expenses and $1.0 million associated with a write-off of deferred debt transaction costs. Fiscal 2017 First Nine Months Results For the nine months ended March 31, 2017, the Company reported net revenue of $148.8 million, a decrease of 3.0% compared to $153.5 million for the first nine months of fiscal 2016. In the first nine months of fiscal 2017, revenue in the Americas decreased 5.6%, while revenue in Asia/Pacific & Europe increased 5.8%. Revenue for the first nine months of fiscal 2017 was positively impacted $3.5 million, or 2.3%, by foreign currency fluctuations associated with revenue generated in several international markets. Gross profit for the first nine months of fiscal 2017 was $124.3 million, or 83.5% of revenue, compared to $129.0 million, or 84.0% of revenue, for the first nine months of fiscal 2016. Commissions and incentives expense for the first nine months of fiscal 2017 was $72.7 million, or 48.8% of revenue, compared to $77.5 million, or 50.5% of revenue, for the first nine months of fiscal 2016. SG&A for the first nine months of fiscal 2017 was $48.7 million, or 32.7% of revenue, compared to $42.1 million, or 27.4% of revenue, in the prior year period. Operating income for the first nine months of fiscal 2017 was $2.9 million, compared to $9.3 million for the first nine months of fiscal 2016. Operating income for the nine months ended March 31, 2017 includes $2.7 million for expenses associated with the Audit Committee independent review, $1.1 million for executive severance, recruiting and transition expenses and $0.1 million of class-action lawsuit expense. Operating income in the first nine months of fiscal 2016 includes $1.6 million of executive severance, recruiting and transition expenses as well as $0.1 million for expenses associated with the reverse stock split completed during October 2015. Adjusted EBITDA was $9.8 million for the first nine months of fiscal 2017, compared to $14.1 million for the same period in fiscal 2016. Net income for the first nine months of fiscal 2017 was $1.5 million, or $0.11 per diluted share, compared to $3.7 million, or $0.26 per diluted share for the first nine months of fiscal 2016. On a tax-adjusted basis, adjusting for previously announced expenses associated with the audit committee independent review of $1.9 million, $0.4 million of costs for net executive severance, recruiting and transition expenses, and $0.1 million of class-action lawsuit expense, adjusted Non-GAAP net income for the nine months ended March 31, 2017 was $3.9 million, or $0.28 per diluted share. On a tax-adjusted basis, adjusting for executive severance, recruiting and transition costs of $0.9 million, along with the $0.1 million for expenses associated with the reserve stock split in October 2015 and $1.0 million associated with a write-off of deferred debt transaction costs, adjusted Non-GAAP net income for the first nine months of fiscal year 2016 was $5.6 million or $0.40 per diluted share. Balance Sheet & Liquidity  The Company generated $4.6 million of cash from operations during the first nine months of fiscal year 2017 compared to $6.2 million in the same period last year. The year-over-year reduction in cash provided by operations during the first nine months of fiscal 2017 primarily relates to the lower level of net income relative to the prior year period and cash used to reduce payables. The Company's cash and cash equivalents at March 31, 2017 were $9.2 million compared to $7.9 million at June 30, 2016. Fourth Quarter Fiscal 2017 Guidance  The Company is providing guidance for the fourth quarter of fiscal year 2017. The Company expects to generate revenue in the range of $51 million to $54 million during the fourth quarter of fiscal 2017, and anticipates adjusted non-GAAP earnings per diluted share in the range of $0.05 to $0.08. The Company's adjusted non-GAAP earnings per diluted share guidance excludes any non-operating or non-recurring expenses that may materialize during the fourth quarter of fiscal 2017. The Company is not providing GAAP earnings per diluted share guidance for the fourth quarter of fiscal 2017 due to the potential occurrence of one or more non-operating, one-time expenses, which the Company does not believe it can reliably predict. Conference Call Information  The Company will hold an investor conference call today at 2:30 p.m. MST (4:30 p.m. EST). Investors interested in participating in the live call can dial (888) 600-4863 from the U.S. International callers can dial (913) 312-0380. A telephone replay will be available approximately two hours after the call concludes and will be available through Monday, May 15, 2017, by dialing (844) 512-2921 from the U.S. and entering confirmation code 9166571, or (412) 317-6671 from international locations, and entering confirmation code 9166571. There will also be a simultaneous, live webcast available on the Investor Relations section of the Company's web site at http://investor.lifevantage.com/events.cfm. The webcast will be archived for approximately 30 days. About LifeVantage Corporation LifeVantage Corporation (Nasdaq:LFVN), is a science-based direct selling company dedicated to visionary science that looks to transform health, wellness and anti-aging internally and externally at the cellular level. The company is the maker of Protandim®Nrf2 and NRF1 Synergizers, its line of scientifically-validated dietary supplements, the TrueScience® Anti-Aging Skin Care Regimen, Petandim™ for dogs, the AXIO® energy product line and the PhysIQ™ smart weight management system. LifeVantage was founded in 2003 and is headquartered in Salt Lake City, Utah. www.lifevantage.com Forward Looking Statements  This document contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words and expressions reflecting optimism, satisfaction or disappointment with current prospects, as well as words such as "believe", "hopes", "intends", "estimates", "expects", "projects", "plans", "anticipates", "look forward to", "goal", “may be”, and variations thereof, identify forward-looking statements, but their absence does not mean that a statement is not forward-looking. Examples of forward-looking statements include, but are not limited to, statements we make regarding the effectiveness of our policies and procedures, future growth and expected financial performance. Such forward-looking statements are not guarantees of performance and the Company's actual results could differ materially from those contained in such statements. These forward-looking statements are based on the Company's current expectations and beliefs concerning future events affecting the Company and involve known and unknown risks and uncertainties that may cause the Company's actual results or outcomes to be materially different from those anticipated and discussed herein. These risks and uncertainties include, among others, those discussed in greater detail in the Company's Annual Report on Form 10-K and the Company's Quarterly Report on Form 10-Q under the caption "Risk Factors," and in other documents filed by the Company from time to time with the Securities and Exchange Commission. The Company cautions investors not to place undue reliance on the forward-looking statements contained in this document. All forward-looking statements are based on information currently available to the Company on the date hereof, and the Company undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this document, except as required by law. About Non-GAAP Financial Measures  We define Non-GAAP EBITDA as earnings before interest expense, income taxes, depreciation and amortization and Non-GAAP Adjusted EBITDA as earnings before interest expense, income taxes, depreciation and amortization, stock compensation expense, other income, net, and certain other adjustments. Non-GAAP EBITDA and Non-GAAP Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.  We define Non-GAAP Net Income and Non-GAAP Earnings per Share as GAAP net income less certain tax adjusted non-recurring one-time expenses incurred during the period. We are presenting Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share because management believes that they provide additional ways to view our operations when considered with both our GAAP results and the reconciliation to net income, which we believe provides a more complete understanding of our business than could be obtained absent this disclosure. Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share are presented solely as supplemental disclosure because: (i) we believe these measures are a useful tool for investors to assess the operating performance of the business without the effect of these items; (ii) we believe that investors will find this data useful in assessing shareholder value; and (iii) we use Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share internally as benchmarks to evaluate our operating performance or compare our performance to that of our competitors. The use of Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings per Share has limitations and you should not consider these measures in isolation from or as an alternative to the relevant GAAP measure of net income prepared in accordance with GAAP, or as a measure of profitability or liquidity. The tables set forth below present Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings per Share which are non-GAAP financial measures to Net Income and Earnings per Share, our most directly comparable financial measures presented in accordance with GAAP.


News Article | May 9, 2017
Site: globenewswire.com

ENGLEWOOD, Colo., May 09, 2017 (GLOBE NEWSWIRE) -- Gevo, Inc. (NASDAQ:GEVO) today announced financial results for the quarter ended March 31, 2017. Key highlights for the first quarter of 2017 and key subsequent events included: Gevo produced approximately 100,000 gallons of isobutanol at its Luverne Facility during the first quarter of 2017. Consistent with Gevo’s previous isobutanol production guidance, production this quarter was focused on producing sufficient quantities of isobutanol to meet immediate customer demand while also providing enough inventory to support additional market and customer development efforts in the future. Gevo’s production goals are not to maximize production, but rather to align such production with its isobutanol sales efforts. As a result, during certain periods of the first quarter of 2017, Gevo only produced ethanol at the Luverne Facility, and in the second quarter of 2017, Gevo may elect to produce only ethanol. In the first quarter, Gevo’s isobutanol market development efforts were focused on gaining market acceptance in its core gasoline blendstock markets such as marinas and on-road gasoline fueling stations, while maintaining its targeted selling price. Gevo continued to work with its distribution partners to make investments to develop end-customer relationships, as well as to establish value chains to deliver its isobutanol to those end-customers. Gevo’s market development efforts related to its renewable hydrocarbon products were mainly targeted towards entering into binding supply agreements to underpin the economics of the proposed expansion of the Luverne Facility. Gevo has been in discussions with numerous potential alcohol-to-jet fuel (ATJ) and isooctane customers to enter into long term supply agreements, with a goal in 2017 of signing contracts representing the majority of the isobutanol production volumes to be produced at the expanded Luverne Facility. In April 2017, as noted above, Gevo entered into its first long term supply agreement with HCS, which Gevo estimates would represent approximately 10-15% of the isooctane production from an expanded Agri-Energy Facility. As Gevo develops markets for its products, there will likely be a mismatch in timing between isobutanol production and sales. As a result, at times Gevo will likely build isobutanol inventory levels.  At March 31, 2017, Gevo had approximately 288,000 gallons of isobutanol and approximately 52,000 gallons of renewable hydrocarbons in inventory. "During our year end update, we set out a number of key strategic initiatives and I am proud to say that we have made meaningful progress towards those goals. So far in 2017 we have significantly improved our balance sheet, as well as signed the exchange agreement with Whitebox that will extend the maturity of our senior debt, assuming a positive stockholder vote in June. This will provide us with additional time to pursue our strategy moving forward. As I have communicated many times, we had to clear this critical financial hurdle before we could more effectively drive customer development and better execute on our long-term expansion plan." said Dr. Patrick Gruber, Gevo’s Chief Executive Officer. Mr. Gruber continued, "As a reminder, our objective is to sell at least 50% of the capacity at the expanded Luverne facility. Although we still have significant work ahead of us, we are excited by the definitive supply agreement with HCS which is a key first step in achieving our targets. The entire Gevo organization is intensely focused on continuing our momentum throughout 2017 and beyond.” Revenues for the first quarter of 2017 were $5.6 million compared with $6.3 million in the same period in 2016. During the first quarter of 2017, revenues derived at the Luverne Facility related to ethanol sales and related products were $5.5 million, a decrease of approximately $0.3 million from the same period in 2016. This was primarily a result of lower ethanol production and distiller grain prices in the first quarter of 2017 versus the same period in 2016. During the first quarter of 2017, hydrocarbon revenues were $0.1 million, $0.2 million lower than the same period in 2016. Gevo’s hydrocarbon revenues are comprised of sales of ATJ, isooctane and isooctene. Gevo generated grant and other revenue of $32,000 during the first quarter of 2017, down $0.2 million as compared to the same period in 2016, mainly as a result of Gevo’s contract with the Northwest Advanced Renewables Alliances ending in 2016. Cost of goods sold was $9.4 million for the three months ended March 31, 2017, compared with $9.2 million in the same period in 2016. Cost of goods sold included approximately $7.9 million associated with the production of ethanol, isobutanol and related products and approximately $1.5 million in depreciation expense. Gross loss was $3.8 million for the three months ended March 31, 2017, versus $2.9 million in the same quarter in 2016. Research and development expense increased by $0.2 million during the three months ended March 31, 2017, compared with the same period in 2016, due primarily to an increase in employee-related expenses. Selling, general and administrative expense increased by $0.3 million during the three months ended March 31, 2017, compared with the same period in 2016, due primarily an increase in employee-related expenses. Loss from operations in the three months ended March 31, 2017 was $7.2 million, compared with $5.9 million in the same period in 2016. Non-GAAP cash EBITDA loss in the three months ended March 31, 2017 was $5.4 million, compared with $3.9 million in the same period in 2016. Interest expense in the three months ended March 31, 2017 was $0.7 million, down $1.4 million as compared to the same period in 2016, due to a decrease in outstanding principal balances of our debt. During the three months ended March 31, 2017, there was no change in the value of the embedded derivatives in the 2022 Notes, as the derivatives have had no meaningful value since the third quarter of 2014.  However, Gevo did incur a non-cash loss of $1.0 million in the quarter as a result of exchanging an aggregate of $8.4 million principal amount of the 2022 Notes for shares of Gevo’s common stock in January 2017. During the three months ended March 31, 2017, Gevo also incurred a non-cash loss of $0.3 million during the quarter due to the quarterly mark-to-market valuation of the 2017 Notes. During the three months ended March 31, 2017, the estimated fair value of the derivative warrant liability decreased by $3.3 million, resulting in a non-cash gain from a change in the fair value of derivative warrant liability. The net loss for the three months ended March 31, 2017 was $5.9 million, compared with $3.6 million during the same period in 2016. The non-GAAP adjusted net loss for the three months ended March 31, 2017 was $7.9 million, compared with $8.0 million during the same period in 2016. The cash position at March 31, 2017 was $20.4 million and the total principal face value of the debt outstanding was $17.7 million. Hosting today’s conference call at 4:30 p.m. EST (2:30 p.m. MST) will be Dr. Patrick Gruber, Chief Executive Officer, Mike Willis, Chief Financial Officer, and Geoff Williams, General Counsel. They will review Gevo’s financial results and provide an update on recent corporate highlights. To participate in the conference call, please dial 1(888) 771-4371 (inside the U.S.) or 1 (847) 585-4405 (outside the U.S.) and reference the access code 44704548. A replay of the call and webcast will be available two hours after the conference call ends on May 9, 2017. To access the replay, please dial 1-888-843-7419 (inside the US) or 1-630-652-3042  (outside the US) and reference the access code 44704548#. The archived webcast will be available in the Investor Relations section of Gevo's website at www.gevo.com. Gevo is a renewable technology, chemical products, and next generation biofuels company. Gevo has developed proprietary technology that uses a combination of synthetic biology, metabolic engineering, chemistry and chemical engineering to focus primarily on the production of isobutanol, as well as related products from renewable feedstocks. Gevo’s strategy is to commercialize biobased alternatives to petroleum-based products to allow for the optimization of fermentation facilities’ assets, with the ultimate goal of maximizing cash flows from the operation of those assets. Gevo produces isobutanol, ethanol and high-value animal feed at its fermentation plant in Luverne, Minnesota. Gevo has also developed technology to produce hydrocarbon products from renewable alcohols. Gevo currently operates a biorefinery in Silsbee, Texas, in collaboration with South Hampton Resources Inc., to produce ATJ, octane, and ingredients for plastics like polyester. Gevo has a marquee list of partners including The Coca-Cola Company, Toray Industries Inc. and Total SA, among others. Gevo is committed to a sustainable bio-based economy that meets society’s needs for plentiful food and clean air and water. Certain statements in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to a variety of matters, including, without limitation, statements related to the ability of Gevo to develop markets for its products, Gevo’s ability to enter into binding offtake, sales or supply agreements for its products, Gevo’s ability to produce isobutanol or related hydrocarbon products at its Luverne Facility, Gevo’s ability to finance, construct and operate the contemplated expanded Luverne Facility, Gevo’s 2017 operational and financial targets and milestones, Gevo’s cash operating and financing expectations, the supply agreement with HCS Holding, stockholder approval of the Exchange and the issuance of the 2020 Notes, the Purchase Agreement, Gevo’s ability to secure new customer relationships across core markets, and other statements that are not purely statements of historical fact.  These forward-looking statements are made on the basis of the current beliefs, expectations and assumptions of the management of Gevo and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Gevo undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Gevo believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Gevo in general, see the risk disclosures in the Annual Report on Form 10-K of Gevo for the year ended December 31, 2016, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the U.S. Securities and Exchange Commission by Gevo. This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), including non-GAAP Cash EBITDA Loss and non-GAAP Adjusted Net Loss Per Share. Non-GAAP Cash EBITDA Loss excludes non-cash items such as depreciation and stock-based compensation. Non-GAAP Adjusted Net Loss Per Share excludes non-cash gains and/or losses recognized in the quarter due to the changes in the fair value of certain of Gevo’s financial instruments, such as warrants, convertible debt and embedded derivatives. Management believes these measures are useful to supplement its GAAP financial statements with this non-GAAP information because management uses such information internally for its operating, budgeting and financial planning purposes. These non-GAAP financial measures also facilitate management's internal comparisons to Gevo’s historical performance as well as comparisons to the operating results of other companies. In addition, Gevo believes these non-GAAP financial measures are useful to investors because they allow for greater transparency into the indicators used by management as a basis for its financial and operational decision making. Non-GAAP information is not prepared under a comprehensive set of accounting rules and therefore, should only be read in conjunction with financial information reported under U.S. GAAP when understanding Gevo’s operating performance. A reconciliation between GAAP and non-GAAP financial information is provided in the financial statement tables below. On December 21, 2016, our Board of Directors approved a reverse split of our common stock, par value $0.01, at a ratio of one-for-twenty.  This reverse stock split became effective on January 5, 2017 and, unless otherwise indicated, all share amounts, per share data, share prices, exercise prices and conversion rates set forth in this press release and the accompanying consolidated financial statements have, where applicable, been adjusted to reflect this reverse stock split. 1 Adjusted Net Loss Per Share is calculated by adding back non-cash gains and/or losses recognized in the quarter due to the changes in the fair value of certain of our financial instruments, such as warrants, convertible debt and embedded derivatives; a reconciliation of Adjusted Net Loss Per Share to GAAP net loss per share is provided in the financial statement tables following this release. 2 Cash EBITDA Loss is calculated by adding back depreciation and non-cash stock compensation to GAAP loss from operations; a reconciliation of Cash EBITDA Loss to GAAP loss from operations is provided in the financial statement tables following this release. Gevo, Inc. Condensed Consolidated Statements of Operations Information (Unaudited, in thousands, except share and per share amounts) Gevo, Inc. Reconciliation of GAAP to Non-GAAP Financial Information (Unaudited, in thousands)


News Article | May 11, 2017
Site: www.businesswire.com

LOUISVILLE, Ky.--(BUSINESS WIRE)--Turning Point Brands, Inc. (NYSE: TPB), a leading provider of Other Tobacco Products (“OTP”) today announced financial results for the first quarter ended March 31, 2017. “Today marks the one-year anniversary of our initial public offering and listing on the NYSE,” said TPB President and Chief Executive Officer, Larry Wexler. “Over the course of the last twelve months, we have produced strong operating results and improved our cash flow, completed two acquisitions and refinanced our debt. We expect to continue to generate organic growth from our focus brands, Zig-Zag, Stoker’s, and VaporBeast. We plan to use our strong cash flow to further strengthen our brands, reduce our debt and fund acquisitions. We believe that we are increasingly well-positioned to continue to grow the business and improve our operating performance.” Management Observations on the First Quarter Smokeless products net sales for the first quarter increased 10.4% to $20.2 million on the continuing growth of Stoker’s MST. Despite an increasingly competitive environment, Stoker’s MST cases shipped in the quarter rose about 9%. Smokeless products volume comparisons to the prior year were favorably impacted by one additional shipping day for the 2017 period, partially offset by the impact of the Pennsylvania excise tax increase (see excise tax discussion below) and by an increase in returned goods relative to the low volume of returns incurred during the new product introductory period a year-ago. For the quarter, volume increased 4.6% and price/mix increased 5.8%. Year-over-year industry volumes for chewing tobacco declined by approximately 5% in the quarter while MST was down approximately 1%, according to MSAi. (TPB measures industry MST volumes excluding pouch and snus products.) TPB outpaced the industry in the quarter and grew its MSAi share in both chewing tobacco and MST. Gross profit for the Smokeless segment increased 0.5%, to $9.3 million. Segment gross margin contracted to 45.7% primarily from a LIFO expense of $1.1 million in the quarter and continuing growth of Stoker’s MST, which carries a lower gross margin than chewing tobacco products. Absent LIFO expense in both years, gross profit increased 7.8% to $10.4 million and gross margin was 51.3%. (See Schedule B for a reconciliation). “We have established a strong foundation of Stoker’s MST distribution in independent retailers and are now focused on generating consumer trial in those store sets, while also accelerating our penetration in the chain store universe,” said Wexler. “We are also on schedule to expand retail distribution of the regional Wind River smokeless brands in late 2017.” The MST industry increased pricing in late April 2017. The increase ranged between 2.2% and 3.1% on 1.2oz cans. Large format tub pricing was more moderate and in the 2.0% range. Net sales of Smoking products decreased $0.7 million for the quarter to $27.2 million. Net sales in the Smoking segment were unfavorably impacted by the previously communicated year-end 2016 trade inventory buildup on cigarette papers, which was in line with our expectations, and an initial trade inventory impact associated with the April 1, 2017 California tax on MYO cigar wraps (see excise tax discussion below). Zig-Zag ‘Rillo cigar wraps continued to produce robust sales gains associated with expanded retail distribution. For the quarter, Smoking products volumes decreased 3.9%, while price/mix increased 1.4%. Industry volumes for cigarette papers declined by mid-single-digits while MYO cigar wraps grew by low double-digits, according to MSAi. Zig-Zag increased its market share versus the year-ago period in cigarette papers and held an 81% share in MYO cigar wraps, according to MSAi. Smoking products gross profit for the quarter decreased by $0.6 million to $13.7 million. Gross margin decreased to 50.4% of net sales compared with 51.3% for the year-ago quarter of 2016. NewGen products net sales for the quarter grew $15.7 million to a record $19.4 million, as a result of the inclusion of a full quarter of VaporBeast’s net sales. In the first quarter, volume increased 420% while price/mix accounted for an increase of 11%. Gross profit for the NewGen segment increased for the quarter versus year-ago by $3.6 million to a record $4.7 million. Gross margin weakened versus a year-ago from 31.0% to 24.3% of net sales for the current period as a result of the mix impact of VaporBeast’s lower distributor margins on the segment. “The VaporBeast integration is proceeding and results are progressing at better than anticipated levels,” said Wexler. “Through our November 2016 acquisition of VaporBeast, we now have ready access to the non-traditional retail outlets they serve and sharply enhanced insights into the product forms and attributes consumers are choosing. Operational improvements are being made across the business and we are pleased with the early progress and are readying plans to more fully leverage the VaporBeast platform late this year.” Wexler continued, “While our strategic partnership with Vapor Shark is still in the formative stages, we are jointly exploring a number of opportunities to collaborate and capture a larger share of the markets and channels we collectively serve. We expect to provide more details next quarter.” Total company net sales growth of 33.9% was driven by volume gains of 30.1% with price/mix contributing another 3.8%. Consolidated selling, general and administrative (“SG&A”) expenses for the quarter were $16.9 million compared to $13.7 million in 2016 due primarily to the inclusion of a full quarter of VaporBeast’s SG&A, strategic expenses, and sales and marketing infrastructure investments. For the first quarter of 2017 SG&A: Non-recurring launch costs in cost of goods sold in the 2017 first quarter were $0.1 million compared to $0.2 million in the first quarter a year-ago. Interest expense for the quarter ended March 31, 2017 was $4.9 million, which is $3.5 million, or 42%, lower than the year-ago period. This decrease is principally attributable to lower average debt levels since our initial public offering coupled with the February 2017 refinancing of our debt. Investment income from our Master Settlement Agreement escrow monies amounted to $0.1 million in the quarter. For the quarter ended March 31, 2017 diluted earnings per share was $0.10 and included an after-tax non-recurring non-cash charge on extinguishment of debt of $0.19 per diluted share. Total debt at March 31, 2017 was $227.4 million. Net debt at March 31, 2017 was $225.2 million, compared to $215.3 million as of December 31, 2016, an increase of $9.9 million. Net debt at March 31, 2017 to rolling twelve month Adjusted EBITDA was 4.2x (see Schedule C for a reconciliation). Net debt at March 31, 2017 to pro forma acquisition EBITDA was 3.8x (See Schedule D for a reconciliation). At March 31, 2017, there were 18.8 million common shares outstanding. Weighted average fully diluted shares for the three months ended March 31, 2017 were 19.6 million. Pennsylvania implemented a $0.55 per ounce excise tax on smokeless products effective October 1, 2016. The impact of the tax increase on trade volumes in the quarter was material to both the industry and TPB. Industry volume degradation on a sequential basis was in the mid-teens for chewing tobacco and high-single digits for MST. TPB outperformed the industry in both chewing tobacco and MST in Pennsylvania, as measured by MSAi. TPB will continue to monitor the impact this excise tax has on consumer behavior. California passed Proposition 56 in November 2016, which included new state excise taxes on liquid vapor products and cigar wraps for the first time. Effective April 1, 2017 all OTP products became subject to the current 27.3% state excise tax. On July 1, 2017 the tax on all OTP products will increase to the new equalized rate that the industry estimates will be between 62% and 68%. We believe that the new excise tax on MYO cigar wraps adversely impacted category sales, as California industry sales for the quarter were materially lower versus year-ago. California represents about 5% of industry MYO cigar wraps, cigars and MST sales and 10% of industry e-cig volumes. These segment percentages generally parallel TPB sales percentages. We anticipate that California Proposition 56 will affect trade behavior for the next six months and we will continue to closely evaluate its impact on consumer behavior. As previously disclosed, a conference call with the investment community to review TPB’s financial results has been scheduled for 10 a.m. Thursday, May 11, 2017. Investment community participants should dial in 10 minutes ahead of time using the toll free number 844-889-4324 (International participants should call 412-317-9262). A live listen-only webcast of the call is available from the Events and Presentations section of the investor relations portion of the company website (www.turningpointbrands.com). A replay of the webcast will be available on the site one hour following the call. In addition to financial measures prepared in accordance with generally accepted accounting principles in the United States (GAAP), this press release includes certain non-GAAP financial measures including Adjusted EBITDA, Net Debt and Gross Profit excluding LIFO. A reconciliation of these non-GAAP financial measures accompanies this release. Louisville, KY based Turning Point Brands, Inc. (NYSE: TPB) is a leading U.S. provider of Other Tobacco Products. TPB, through its three focus brands, Zig-Zag® in Smoking Products, Stoker’s® in Smokeless Products and the VaporBeast™ distribution engine in NewGen Products, generates solid cash flow which it uses to finance acquisitions, increase brand support and improve its debt/equity ratio. More information about the company is available at its corporate website, www.turningpointbrands.com. This press release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements may generally be identified by the use of words such as "anticipate," "believe," "expect," "intend," "plan" and "will" or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. As a result, actual events may differ materially from those expressed in or suggested by the forward-looking statements. Any forward-looking statement made by TPB in this press release speaks only as of the date hereof. New risks and uncertainties come up from time to time, and it is impossible for TPB to predict these events or how they may affect it. TPB has no obligation, and does not intend, to update any forward-looking statements after the date hereof, except as required by federal securities laws. Factors that could cause these differences include, but are not limited to: To supplement our financial information presented in accordance with generally accepted accounting principles in the United States, or U.S. GAAP, we use non-U.S. GAAP financial measures, including EBITDA, Adjusted EBITDA, Net Debt and Gross Profit excluding LIFO. We believe Adjusted EBITDA provides useful information to management and investors regarding certain financial and business trends relating to our financial condition and results of operations. Adjusted EBITDA, Net Debt and Gross Profit excluding LIFO are used by management to compare our performance to that of prior periods for trend analyses and planning purposes and is presented to our board of directors. We believe that EBITDA, Adjusted EBITDA and Gross Profit excluding LIFO are appropriate measures of operating performance because they eliminate the impact of expenses that do not relate to business performance. We define “EBITDA” as net income before interest expense, loss on extinguishment of debt, provision for income taxes, depreciation and amortization. We define “Adjusted EBITDA” as net income before interest expense, loss on extinguishment of debt, provision for income taxes, depreciation, amortization, other non-cash items and other items that we do not consider ordinary course in our evaluation of ongoing operating performance. We define “Net Debt” as total debt less cash. We define “Gross Profit excluding LIFO” as gross profit less LIFO charges. Non-U.S. GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with U.S. GAAP. Adjusted EBITDA excludes significant expenses that are required by U.S. GAAP to be recorded in our financial statements and is subject to inherent limitations. In addition, other companies in our industry may calculate this non-U.S. GAAP measure differently than we do or may not calculate it at all, limiting its usefulness as a comparative measure. The table below provides a reconciliation between net income and Adjusted EBITDA for the three months ended March 31, 2017 and March 31, 2016.


News Article | May 10, 2017
Site: globenewswire.com

SALT LAKE CITY, May 10, 2017 (GLOBE NEWSWIRE) -- LifeVantage Corporation (Nasdaq:LFVN) today reported financial results for its third quarter ended March 31, 2017. “We began to see the turn in sequential sales momentum as the third quarter progressed,” stated LifeVantage President and Chief Executive Officer Darren Jensen. “While sales were negatively impacted early in the quarter, we finished the third quarter with reaccelerating sales growth as we were finalizing the implementation of remedies relating to a recent review of international policies and procedures. We enter the fourth quarter with renewed business momentum and completed a successful global convention in April that included our rebranding of several key product lines, the introduction of product bundles that deliver greater value for customers and distributors, and integrated applications and technology solutions that were well received by distributors. Finally, we are progressing with plans to broaden our geographical footprint, and look forward to discussing specific activities to support this growth as the plan progresses.” Third Quarter Fiscal 2017 Results  For the third fiscal quarter ended March 31, 2017, the Company reported revenue of $45.0 million, a 19.9% decrease compared to $56.2 million for the comparable period in fiscal 2016. Year-over-year quarterly revenue reflects a decrease of 21.9% in the Americas and a 12.5% decrease in the Asia/Pacific & Europe region. Revenues in the Company’s United States and Hong Kong markets decreased for the third quarter of fiscal 2017 as the Company continued to take steps to help ensure that the Company’s products are not distributed or sold into countries without complying with applicable customs, tax and other regulatory requirements and to appropriately verify the residency of individuals who want to become independent distributors of the Company. Revenue for the third fiscal quarter ended March 31, 2017, was positively impacted $0.1 million, or 0.2%, by foreign currency fluctuations associated with revenue generated in several international markets. Gross profit for the third quarter of fiscal 2017 was $36.8 million, or 81.7% of revenue, compared to $46.4 million, or 82.7% of revenue, for the same period in fiscal 2016. Commissions and incentives expense for the third quarter of fiscal 2017 was $22.8 million, or 50.8% of revenue, compared to $28.2 million, or 50.2% of revenue, for the same period in fiscal 2016. Selling, general and administrative expense (SG&A) for the third quarter of fiscal 2017 was $13.7 million, or 30.5% of revenue, compared to $14.6 million, or 26.1% of revenue, in the comparable period of fiscal 2016. Operating income for the third quarter of fiscal 2017 was $0.2 million, compared to $3.6 million for the third quarter of fiscal 2016. Operating income during the third quarter of fiscal 2017 included approximately $0.6 million for expenses associated with executive severance, recruiting and transition expenses, and $0.1 million of class-action lawsuit expense. Operating income during the third quarter of fiscal 2016 included approximately $0.1 million of costs associated with executive team recruiting and transition expenses. Adjusted EBITDA was $1.6 million for the third quarter of fiscal 2017, compared to $5.1 million for the comparable period in fiscal 2016. Net income for the third quarter of fiscal 2017 was $0.1 million, or $0.00 per diluted share, calculated on 14.1 million fully diluted shares.  This compares to net income for the third quarter of fiscal 2016 of $1.0 million, or $0.07 per diluted share, calculated on 14.1 million fully diluted shares. Adjusted for net executive severance, recruiting and transition expenses of $0.3 million and class-action lawsuit expense of $0.1 million, all net of tax, adjusted Non-GAAP net income was $0.4 million for the third quarter of fiscal 2017, or $0.02 per diluted share; compared to $2.0 million, or $0.14 per diluted share for the comparable period of fiscal 2016. Non-GAAP adjustments to net income during the third quarter of fiscal 2016 included $0.1 million of executive team recruiting and transition expenses and $1.0 million associated with a write-off of deferred debt transaction costs. Fiscal 2017 First Nine Months Results For the nine months ended March 31, 2017, the Company reported net revenue of $148.8 million, a decrease of 3.0% compared to $153.5 million for the first nine months of fiscal 2016. In the first nine months of fiscal 2017, revenue in the Americas decreased 5.6%, while revenue in Asia/Pacific & Europe increased 5.8%. Revenue for the first nine months of fiscal 2017 was positively impacted $3.5 million, or 2.3%, by foreign currency fluctuations associated with revenue generated in several international markets. Gross profit for the first nine months of fiscal 2017 was $124.3 million, or 83.5% of revenue, compared to $129.0 million, or 84.0% of revenue, for the first nine months of fiscal 2016. Commissions and incentives expense for the first nine months of fiscal 2017 was $72.7 million, or 48.8% of revenue, compared to $77.5 million, or 50.5% of revenue, for the first nine months of fiscal 2016. SG&A for the first nine months of fiscal 2017 was $48.7 million, or 32.7% of revenue, compared to $42.1 million, or 27.4% of revenue, in the prior year period. Operating income for the first nine months of fiscal 2017 was $2.9 million, compared to $9.3 million for the first nine months of fiscal 2016. Operating income for the nine months ended March 31, 2017 includes $2.7 million for expenses associated with the Audit Committee independent review, $1.1 million for executive severance, recruiting and transition expenses and $0.1 million of class-action lawsuit expense. Operating income in the first nine months of fiscal 2016 includes $1.6 million of executive severance, recruiting and transition expenses as well as $0.1 million for expenses associated with the reverse stock split completed during October 2015. Adjusted EBITDA was $9.8 million for the first nine months of fiscal 2017, compared to $14.1 million for the same period in fiscal 2016. Net income for the first nine months of fiscal 2017 was $1.5 million, or $0.11 per diluted share, compared to $3.7 million, or $0.26 per diluted share for the first nine months of fiscal 2016. On a tax-adjusted basis, adjusting for previously announced expenses associated with the audit committee independent review of $1.9 million, $0.4 million of costs for net executive severance, recruiting and transition expenses, and $0.1 million of class-action lawsuit expense, adjusted Non-GAAP net income for the nine months ended March 31, 2017 was $3.9 million, or $0.28 per diluted share. On a tax-adjusted basis, adjusting for executive severance, recruiting and transition costs of $0.9 million, along with the $0.1 million for expenses associated with the reserve stock split in October 2015 and $1.0 million associated with a write-off of deferred debt transaction costs, adjusted Non-GAAP net income for the first nine months of fiscal year 2016 was $5.6 million or $0.40 per diluted share. Balance Sheet & Liquidity  The Company generated $4.6 million of cash from operations during the first nine months of fiscal year 2017 compared to $6.2 million in the same period last year. The year-over-year reduction in cash provided by operations during the first nine months of fiscal 2017 primarily relates to the lower level of net income relative to the prior year period and cash used to reduce payables. The Company's cash and cash equivalents at March 31, 2017 were $9.2 million compared to $7.9 million at June 30, 2016. Fourth Quarter Fiscal 2017 Guidance  The Company is providing guidance for the fourth quarter of fiscal year 2017. The Company expects to generate revenue in the range of $51 million to $54 million during the fourth quarter of fiscal 2017, and anticipates adjusted non-GAAP earnings per diluted share in the range of $0.05 to $0.08. The Company's adjusted non-GAAP earnings per diluted share guidance excludes any non-operating or non-recurring expenses that may materialize during the fourth quarter of fiscal 2017. The Company is not providing GAAP earnings per diluted share guidance for the fourth quarter of fiscal 2017 due to the potential occurrence of one or more non-operating, one-time expenses, which the Company does not believe it can reliably predict. Conference Call Information  The Company will hold an investor conference call today at 2:30 p.m. MST (4:30 p.m. EST). Investors interested in participating in the live call can dial (888) 600-4863 from the U.S. International callers can dial (913) 312-0380. A telephone replay will be available approximately two hours after the call concludes and will be available through Monday, May 15, 2017, by dialing (844) 512-2921 from the U.S. and entering confirmation code 9166571, or (412) 317-6671 from international locations, and entering confirmation code 9166571. There will also be a simultaneous, live webcast available on the Investor Relations section of the Company's web site at http://investor.lifevantage.com/events.cfm. The webcast will be archived for approximately 30 days. About LifeVantage Corporation LifeVantage Corporation (Nasdaq:LFVN), is a science-based direct selling company dedicated to visionary science that looks to transform health, wellness and anti-aging internally and externally at the cellular level. The company is the maker of Protandim®Nrf2 and NRF1 Synergizers, its line of scientifically-validated dietary supplements, the TrueScience® Anti-Aging Skin Care Regimen, Petandim™ for dogs, the AXIO® energy product line and the PhysIQ™ smart weight management system. LifeVantage was founded in 2003 and is headquartered in Salt Lake City, Utah. www.lifevantage.com Forward Looking Statements  This document contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words and expressions reflecting optimism, satisfaction or disappointment with current prospects, as well as words such as "believe", "hopes", "intends", "estimates", "expects", "projects", "plans", "anticipates", "look forward to", "goal", “may be”, and variations thereof, identify forward-looking statements, but their absence does not mean that a statement is not forward-looking. Examples of forward-looking statements include, but are not limited to, statements we make regarding the effectiveness of our policies and procedures, future growth and expected financial performance. Such forward-looking statements are not guarantees of performance and the Company's actual results could differ materially from those contained in such statements. These forward-looking statements are based on the Company's current expectations and beliefs concerning future events affecting the Company and involve known and unknown risks and uncertainties that may cause the Company's actual results or outcomes to be materially different from those anticipated and discussed herein. These risks and uncertainties include, among others, those discussed in greater detail in the Company's Annual Report on Form 10-K and the Company's Quarterly Report on Form 10-Q under the caption "Risk Factors," and in other documents filed by the Company from time to time with the Securities and Exchange Commission. The Company cautions investors not to place undue reliance on the forward-looking statements contained in this document. All forward-looking statements are based on information currently available to the Company on the date hereof, and the Company undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this document, except as required by law. About Non-GAAP Financial Measures  We define Non-GAAP EBITDA as earnings before interest expense, income taxes, depreciation and amortization and Non-GAAP Adjusted EBITDA as earnings before interest expense, income taxes, depreciation and amortization, stock compensation expense, other income, net, and certain other adjustments. Non-GAAP EBITDA and Non-GAAP Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.  We define Non-GAAP Net Income and Non-GAAP Earnings per Share as GAAP net income less certain tax adjusted non-recurring one-time expenses incurred during the period. We are presenting Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share because management believes that they provide additional ways to view our operations when considered with both our GAAP results and the reconciliation to net income, which we believe provides a more complete understanding of our business than could be obtained absent this disclosure. Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share are presented solely as supplemental disclosure because: (i) we believe these measures are a useful tool for investors to assess the operating performance of the business without the effect of these items; (ii) we believe that investors will find this data useful in assessing shareholder value; and (iii) we use Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share internally as benchmarks to evaluate our operating performance or compare our performance to that of our competitors. The use of Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings per Share has limitations and you should not consider these measures in isolation from or as an alternative to the relevant GAAP measure of net income prepared in accordance with GAAP, or as a measure of profitability or liquidity. The tables set forth below present Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings per Share which are non-GAAP financial measures to Net Income and Earnings per Share, our most directly comparable financial measures presented in accordance with GAAP.


News Article | May 10, 2017
Site: globenewswire.com

SALT LAKE CITY, May 10, 2017 (GLOBE NEWSWIRE) -- LifeVantage Corporation (Nasdaq:LFVN) today reported financial results for its third quarter ended March 31, 2017. “We began to see the turn in sequential sales momentum as the third quarter progressed,” stated LifeVantage President and Chief Executive Officer Darren Jensen. “While sales were negatively impacted early in the quarter, we finished the third quarter with reaccelerating sales growth as we were finalizing the implementation of remedies relating to a recent review of international policies and procedures. We enter the fourth quarter with renewed business momentum and completed a successful global convention in April that included our rebranding of several key product lines, the introduction of product bundles that deliver greater value for customers and distributors, and integrated applications and technology solutions that were well received by distributors. Finally, we are progressing with plans to broaden our geographical footprint, and look forward to discussing specific activities to support this growth as the plan progresses.” Third Quarter Fiscal 2017 Results  For the third fiscal quarter ended March 31, 2017, the Company reported revenue of $45.0 million, a 19.9% decrease compared to $56.2 million for the comparable period in fiscal 2016. Year-over-year quarterly revenue reflects a decrease of 21.9% in the Americas and a 12.5% decrease in the Asia/Pacific & Europe region. Revenues in the Company’s United States and Hong Kong markets decreased for the third quarter of fiscal 2017 as the Company continued to take steps to help ensure that the Company’s products are not distributed or sold into countries without complying with applicable customs, tax and other regulatory requirements and to appropriately verify the residency of individuals who want to become independent distributors of the Company. Revenue for the third fiscal quarter ended March 31, 2017, was positively impacted $0.1 million, or 0.2%, by foreign currency fluctuations associated with revenue generated in several international markets. Gross profit for the third quarter of fiscal 2017 was $36.8 million, or 81.7% of revenue, compared to $46.4 million, or 82.7% of revenue, for the same period in fiscal 2016. Commissions and incentives expense for the third quarter of fiscal 2017 was $22.8 million, or 50.8% of revenue, compared to $28.2 million, or 50.2% of revenue, for the same period in fiscal 2016. Selling, general and administrative expense (SG&A) for the third quarter of fiscal 2017 was $13.7 million, or 30.5% of revenue, compared to $14.6 million, or 26.1% of revenue, in the comparable period of fiscal 2016. Operating income for the third quarter of fiscal 2017 was $0.2 million, compared to $3.6 million for the third quarter of fiscal 2016. Operating income during the third quarter of fiscal 2017 included approximately $0.6 million for expenses associated with executive severance, recruiting and transition expenses, and $0.1 million of class-action lawsuit expense. Operating income during the third quarter of fiscal 2016 included approximately $0.1 million of costs associated with executive team recruiting and transition expenses. Adjusted EBITDA was $1.6 million for the third quarter of fiscal 2017, compared to $5.1 million for the comparable period in fiscal 2016. Net income for the third quarter of fiscal 2017 was $0.1 million, or $0.00 per diluted share, calculated on 14.1 million fully diluted shares.  This compares to net income for the third quarter of fiscal 2016 of $1.0 million, or $0.07 per diluted share, calculated on 14.1 million fully diluted shares. Adjusted for net executive severance, recruiting and transition expenses of $0.3 million and class-action lawsuit expense of $0.1 million, all net of tax, adjusted Non-GAAP net income was $0.4 million for the third quarter of fiscal 2017, or $0.02 per diluted share; compared to $2.0 million, or $0.14 per diluted share for the comparable period of fiscal 2016. Non-GAAP adjustments to net income during the third quarter of fiscal 2016 included $0.1 million of executive team recruiting and transition expenses and $1.0 million associated with a write-off of deferred debt transaction costs. Fiscal 2017 First Nine Months Results For the nine months ended March 31, 2017, the Company reported net revenue of $148.8 million, a decrease of 3.0% compared to $153.5 million for the first nine months of fiscal 2016. In the first nine months of fiscal 2017, revenue in the Americas decreased 5.6%, while revenue in Asia/Pacific & Europe increased 5.8%. Revenue for the first nine months of fiscal 2017 was positively impacted $3.5 million, or 2.3%, by foreign currency fluctuations associated with revenue generated in several international markets. Gross profit for the first nine months of fiscal 2017 was $124.3 million, or 83.5% of revenue, compared to $129.0 million, or 84.0% of revenue, for the first nine months of fiscal 2016. Commissions and incentives expense for the first nine months of fiscal 2017 was $72.7 million, or 48.8% of revenue, compared to $77.5 million, or 50.5% of revenue, for the first nine months of fiscal 2016. SG&A for the first nine months of fiscal 2017 was $48.7 million, or 32.7% of revenue, compared to $42.1 million, or 27.4% of revenue, in the prior year period. Operating income for the first nine months of fiscal 2017 was $2.9 million, compared to $9.3 million for the first nine months of fiscal 2016. Operating income for the nine months ended March 31, 2017 includes $2.7 million for expenses associated with the Audit Committee independent review, $1.1 million for executive severance, recruiting and transition expenses and $0.1 million of class-action lawsuit expense. Operating income in the first nine months of fiscal 2016 includes $1.6 million of executive severance, recruiting and transition expenses as well as $0.1 million for expenses associated with the reverse stock split completed during October 2015. Adjusted EBITDA was $9.8 million for the first nine months of fiscal 2017, compared to $14.1 million for the same period in fiscal 2016. Net income for the first nine months of fiscal 2017 was $1.5 million, or $0.11 per diluted share, compared to $3.7 million, or $0.26 per diluted share for the first nine months of fiscal 2016. On a tax-adjusted basis, adjusting for previously announced expenses associated with the audit committee independent review of $1.9 million, $0.4 million of costs for net executive severance, recruiting and transition expenses, and $0.1 million of class-action lawsuit expense, adjusted Non-GAAP net income for the nine months ended March 31, 2017 was $3.9 million, or $0.28 per diluted share. On a tax-adjusted basis, adjusting for executive severance, recruiting and transition costs of $0.9 million, along with the $0.1 million for expenses associated with the reserve stock split in October 2015 and $1.0 million associated with a write-off of deferred debt transaction costs, adjusted Non-GAAP net income for the first nine months of fiscal year 2016 was $5.6 million or $0.40 per diluted share. Balance Sheet & Liquidity  The Company generated $4.6 million of cash from operations during the first nine months of fiscal year 2017 compared to $6.2 million in the same period last year. The year-over-year reduction in cash provided by operations during the first nine months of fiscal 2017 primarily relates to the lower level of net income relative to the prior year period and cash used to reduce payables. The Company's cash and cash equivalents at March 31, 2017 were $9.2 million compared to $7.9 million at June 30, 2016. Fourth Quarter Fiscal 2017 Guidance  The Company is providing guidance for the fourth quarter of fiscal year 2017. The Company expects to generate revenue in the range of $51 million to $54 million during the fourth quarter of fiscal 2017, and anticipates adjusted non-GAAP earnings per diluted share in the range of $0.05 to $0.08. The Company's adjusted non-GAAP earnings per diluted share guidance excludes any non-operating or non-recurring expenses that may materialize during the fourth quarter of fiscal 2017. The Company is not providing GAAP earnings per diluted share guidance for the fourth quarter of fiscal 2017 due to the potential occurrence of one or more non-operating, one-time expenses, which the Company does not believe it can reliably predict. Conference Call Information  The Company will hold an investor conference call today at 2:30 p.m. MST (4:30 p.m. EST). Investors interested in participating in the live call can dial (888) 600-4863 from the U.S. International callers can dial (913) 312-0380. A telephone replay will be available approximately two hours after the call concludes and will be available through Monday, May 15, 2017, by dialing (844) 512-2921 from the U.S. and entering confirmation code 9166571, or (412) 317-6671 from international locations, and entering confirmation code 9166571. There will also be a simultaneous, live webcast available on the Investor Relations section of the Company's web site at http://investor.lifevantage.com/events.cfm. The webcast will be archived for approximately 30 days. About LifeVantage Corporation LifeVantage Corporation (Nasdaq:LFVN), is a science-based direct selling company dedicated to visionary science that looks to transform health, wellness and anti-aging internally and externally at the cellular level. The company is the maker of Protandim®Nrf2 and NRF1 Synergizers, its line of scientifically-validated dietary supplements, the TrueScience® Anti-Aging Skin Care Regimen, Petandim™ for dogs, the AXIO® energy product line and the PhysIQ™ smart weight management system. LifeVantage was founded in 2003 and is headquartered in Salt Lake City, Utah. www.lifevantage.com Forward Looking Statements  This document contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words and expressions reflecting optimism, satisfaction or disappointment with current prospects, as well as words such as "believe", "hopes", "intends", "estimates", "expects", "projects", "plans", "anticipates", "look forward to", "goal", “may be”, and variations thereof, identify forward-looking statements, but their absence does not mean that a statement is not forward-looking. Examples of forward-looking statements include, but are not limited to, statements we make regarding the effectiveness of our policies and procedures, future growth and expected financial performance. Such forward-looking statements are not guarantees of performance and the Company's actual results could differ materially from those contained in such statements. These forward-looking statements are based on the Company's current expectations and beliefs concerning future events affecting the Company and involve known and unknown risks and uncertainties that may cause the Company's actual results or outcomes to be materially different from those anticipated and discussed herein. These risks and uncertainties include, among others, those discussed in greater detail in the Company's Annual Report on Form 10-K and the Company's Quarterly Report on Form 10-Q under the caption "Risk Factors," and in other documents filed by the Company from time to time with the Securities and Exchange Commission. The Company cautions investors not to place undue reliance on the forward-looking statements contained in this document. All forward-looking statements are based on information currently available to the Company on the date hereof, and the Company undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this document, except as required by law. About Non-GAAP Financial Measures  We define Non-GAAP EBITDA as earnings before interest expense, income taxes, depreciation and amortization and Non-GAAP Adjusted EBITDA as earnings before interest expense, income taxes, depreciation and amortization, stock compensation expense, other income, net, and certain other adjustments. Non-GAAP EBITDA and Non-GAAP Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.  We define Non-GAAP Net Income and Non-GAAP Earnings per Share as GAAP net income less certain tax adjusted non-recurring one-time expenses incurred during the period. We are presenting Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share because management believes that they provide additional ways to view our operations when considered with both our GAAP results and the reconciliation to net income, which we believe provides a more complete understanding of our business than could be obtained absent this disclosure. Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share are presented solely as supplemental disclosure because: (i) we believe these measures are a useful tool for investors to assess the operating performance of the business without the effect of these items; (ii) we believe that investors will find this data useful in assessing shareholder value; and (iii) we use Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share internally as benchmarks to evaluate our operating performance or compare our performance to that of our competitors. The use of Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings per Share has limitations and you should not consider these measures in isolation from or as an alternative to the relevant GAAP measure of net income prepared in accordance with GAAP, or as a measure of profitability or liquidity. The tables set forth below present Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings per Share which are non-GAAP financial measures to Net Income and Earnings per Share, our most directly comparable financial measures presented in accordance with GAAP.


News Article | May 10, 2017
Site: globenewswire.com

SALT LAKE CITY, May 10, 2017 (GLOBE NEWSWIRE) -- LifeVantage Corporation (Nasdaq:LFVN) today reported financial results for its third quarter ended March 31, 2017. “We began to see the turn in sequential sales momentum as the third quarter progressed,” stated LifeVantage President and Chief Executive Officer Darren Jensen. “While sales were negatively impacted early in the quarter, we finished the third quarter with reaccelerating sales growth as we were finalizing the implementation of remedies relating to a recent review of international policies and procedures. We enter the fourth quarter with renewed business momentum and completed a successful global convention in April that included our rebranding of several key product lines, the introduction of product bundles that deliver greater value for customers and distributors, and integrated applications and technology solutions that were well received by distributors. Finally, we are progressing with plans to broaden our geographical footprint, and look forward to discussing specific activities to support this growth as the plan progresses.” Third Quarter Fiscal 2017 Results  For the third fiscal quarter ended March 31, 2017, the Company reported revenue of $45.0 million, a 19.9% decrease compared to $56.2 million for the comparable period in fiscal 2016. Year-over-year quarterly revenue reflects a decrease of 21.9% in the Americas and a 12.5% decrease in the Asia/Pacific & Europe region. Revenues in the Company’s United States and Hong Kong markets decreased for the third quarter of fiscal 2017 as the Company continued to take steps to help ensure that the Company’s products are not distributed or sold into countries without complying with applicable customs, tax and other regulatory requirements and to appropriately verify the residency of individuals who want to become independent distributors of the Company. Revenue for the third fiscal quarter ended March 31, 2017, was positively impacted $0.1 million, or 0.2%, by foreign currency fluctuations associated with revenue generated in several international markets. Gross profit for the third quarter of fiscal 2017 was $36.8 million, or 81.7% of revenue, compared to $46.4 million, or 82.7% of revenue, for the same period in fiscal 2016. Commissions and incentives expense for the third quarter of fiscal 2017 was $22.8 million, or 50.8% of revenue, compared to $28.2 million, or 50.2% of revenue, for the same period in fiscal 2016. Selling, general and administrative expense (SG&A) for the third quarter of fiscal 2017 was $13.7 million, or 30.5% of revenue, compared to $14.6 million, or 26.1% of revenue, in the comparable period of fiscal 2016. Operating income for the third quarter of fiscal 2017 was $0.2 million, compared to $3.6 million for the third quarter of fiscal 2016. Operating income during the third quarter of fiscal 2017 included approximately $0.6 million for expenses associated with executive severance, recruiting and transition expenses, and $0.1 million of class-action lawsuit expense. Operating income during the third quarter of fiscal 2016 included approximately $0.1 million of costs associated with executive team recruiting and transition expenses. Adjusted EBITDA was $1.6 million for the third quarter of fiscal 2017, compared to $5.1 million for the comparable period in fiscal 2016. Net income for the third quarter of fiscal 2017 was $0.1 million, or $0.00 per diluted share, calculated on 14.1 million fully diluted shares.  This compares to net income for the third quarter of fiscal 2016 of $1.0 million, or $0.07 per diluted share, calculated on 14.1 million fully diluted shares. Adjusted for net executive severance, recruiting and transition expenses of $0.3 million and class-action lawsuit expense of $0.1 million, all net of tax, adjusted Non-GAAP net income was $0.4 million for the third quarter of fiscal 2017, or $0.02 per diluted share; compared to $2.0 million, or $0.14 per diluted share for the comparable period of fiscal 2016. Non-GAAP adjustments to net income during the third quarter of fiscal 2016 included $0.1 million of executive team recruiting and transition expenses and $1.0 million associated with a write-off of deferred debt transaction costs. Fiscal 2017 First Nine Months Results For the nine months ended March 31, 2017, the Company reported net revenue of $148.8 million, a decrease of 3.0% compared to $153.5 million for the first nine months of fiscal 2016. In the first nine months of fiscal 2017, revenue in the Americas decreased 5.6%, while revenue in Asia/Pacific & Europe increased 5.8%. Revenue for the first nine months of fiscal 2017 was positively impacted $3.5 million, or 2.3%, by foreign currency fluctuations associated with revenue generated in several international markets. Gross profit for the first nine months of fiscal 2017 was $124.3 million, or 83.5% of revenue, compared to $129.0 million, or 84.0% of revenue, for the first nine months of fiscal 2016. Commissions and incentives expense for the first nine months of fiscal 2017 was $72.7 million, or 48.8% of revenue, compared to $77.5 million, or 50.5% of revenue, for the first nine months of fiscal 2016. SG&A for the first nine months of fiscal 2017 was $48.7 million, or 32.7% of revenue, compared to $42.1 million, or 27.4% of revenue, in the prior year period. Operating income for the first nine months of fiscal 2017 was $2.9 million, compared to $9.3 million for the first nine months of fiscal 2016. Operating income for the nine months ended March 31, 2017 includes $2.7 million for expenses associated with the Audit Committee independent review, $1.1 million for executive severance, recruiting and transition expenses and $0.1 million of class-action lawsuit expense. Operating income in the first nine months of fiscal 2016 includes $1.6 million of executive severance, recruiting and transition expenses as well as $0.1 million for expenses associated with the reverse stock split completed during October 2015. Adjusted EBITDA was $9.8 million for the first nine months of fiscal 2017, compared to $14.1 million for the same period in fiscal 2016. Net income for the first nine months of fiscal 2017 was $1.5 million, or $0.11 per diluted share, compared to $3.7 million, or $0.26 per diluted share for the first nine months of fiscal 2016. On a tax-adjusted basis, adjusting for previously announced expenses associated with the audit committee independent review of $1.9 million, $0.4 million of costs for net executive severance, recruiting and transition expenses, and $0.1 million of class-action lawsuit expense, adjusted Non-GAAP net income for the nine months ended March 31, 2017 was $3.9 million, or $0.28 per diluted share. On a tax-adjusted basis, adjusting for executive severance, recruiting and transition costs of $0.9 million, along with the $0.1 million for expenses associated with the reserve stock split in October 2015 and $1.0 million associated with a write-off of deferred debt transaction costs, adjusted Non-GAAP net income for the first nine months of fiscal year 2016 was $5.6 million or $0.40 per diluted share. Balance Sheet & Liquidity  The Company generated $4.6 million of cash from operations during the first nine months of fiscal year 2017 compared to $6.2 million in the same period last year. The year-over-year reduction in cash provided by operations during the first nine months of fiscal 2017 primarily relates to the lower level of net income relative to the prior year period and cash used to reduce payables. The Company's cash and cash equivalents at March 31, 2017 were $9.2 million compared to $7.9 million at June 30, 2016. Fourth Quarter Fiscal 2017 Guidance  The Company is providing guidance for the fourth quarter of fiscal year 2017. The Company expects to generate revenue in the range of $51 million to $54 million during the fourth quarter of fiscal 2017, and anticipates adjusted non-GAAP earnings per diluted share in the range of $0.05 to $0.08. The Company's adjusted non-GAAP earnings per diluted share guidance excludes any non-operating or non-recurring expenses that may materialize during the fourth quarter of fiscal 2017. The Company is not providing GAAP earnings per diluted share guidance for the fourth quarter of fiscal 2017 due to the potential occurrence of one or more non-operating, one-time expenses, which the Company does not believe it can reliably predict. Conference Call Information  The Company will hold an investor conference call today at 2:30 p.m. MST (4:30 p.m. EST). Investors interested in participating in the live call can dial (888) 600-4863 from the U.S. International callers can dial (913) 312-0380. A telephone replay will be available approximately two hours after the call concludes and will be available through Monday, May 15, 2017, by dialing (844) 512-2921 from the U.S. and entering confirmation code 9166571, or (412) 317-6671 from international locations, and entering confirmation code 9166571. There will also be a simultaneous, live webcast available on the Investor Relations section of the Company's web site at http://investor.lifevantage.com/events.cfm. The webcast will be archived for approximately 30 days. About LifeVantage Corporation LifeVantage Corporation (Nasdaq:LFVN), is a science-based direct selling company dedicated to visionary science that looks to transform health, wellness and anti-aging internally and externally at the cellular level. The company is the maker of Protandim®Nrf2 and NRF1 Synergizers, its line of scientifically-validated dietary supplements, the TrueScience® Anti-Aging Skin Care Regimen, Petandim™ for dogs, the AXIO® energy product line and the PhysIQ™ smart weight management system. LifeVantage was founded in 2003 and is headquartered in Salt Lake City, Utah. www.lifevantage.com Forward Looking Statements  This document contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words and expressions reflecting optimism, satisfaction or disappointment with current prospects, as well as words such as "believe", "hopes", "intends", "estimates", "expects", "projects", "plans", "anticipates", "look forward to", "goal", “may be”, and variations thereof, identify forward-looking statements, but their absence does not mean that a statement is not forward-looking. Examples of forward-looking statements include, but are not limited to, statements we make regarding the effectiveness of our policies and procedures, future growth and expected financial performance. Such forward-looking statements are not guarantees of performance and the Company's actual results could differ materially from those contained in such statements. These forward-looking statements are based on the Company's current expectations and beliefs concerning future events affecting the Company and involve known and unknown risks and uncertainties that may cause the Company's actual results or outcomes to be materially different from those anticipated and discussed herein. These risks and uncertainties include, among others, those discussed in greater detail in the Company's Annual Report on Form 10-K and the Company's Quarterly Report on Form 10-Q under the caption "Risk Factors," and in other documents filed by the Company from time to time with the Securities and Exchange Commission. The Company cautions investors not to place undue reliance on the forward-looking statements contained in this document. All forward-looking statements are based on information currently available to the Company on the date hereof, and the Company undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this document, except as required by law. About Non-GAAP Financial Measures  We define Non-GAAP EBITDA as earnings before interest expense, income taxes, depreciation and amortization and Non-GAAP Adjusted EBITDA as earnings before interest expense, income taxes, depreciation and amortization, stock compensation expense, other income, net, and certain other adjustments. Non-GAAP EBITDA and Non-GAAP Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.  We define Non-GAAP Net Income and Non-GAAP Earnings per Share as GAAP net income less certain tax adjusted non-recurring one-time expenses incurred during the period. We are presenting Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share because management believes that they provide additional ways to view our operations when considered with both our GAAP results and the reconciliation to net income, which we believe provides a more complete understanding of our business than could be obtained absent this disclosure. Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share are presented solely as supplemental disclosure because: (i) we believe these measures are a useful tool for investors to assess the operating performance of the business without the effect of these items; (ii) we believe that investors will find this data useful in assessing shareholder value; and (iii) we use Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per Share internally as benchmarks to evaluate our operating performance or compare our performance to that of our competitors. The use of Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings per Share has limitations and you should not consider these measures in isolation from or as an alternative to the relevant GAAP measure of net income prepared in accordance with GAAP, or as a measure of profitability or liquidity. The tables set forth below present Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings per Share which are non-GAAP financial measures to Net Income and Earnings per Share, our most directly comparable financial measures presented in accordance with GAAP.


News Article | May 11, 2017
Site: globenewswire.com

CALGARY, Alberta, May 10, 2017 (GLOBE NEWSWIRE) -- Delphi Energy Corp. (“Delphi” or the “Company”) is pleased to announce its financial and operational results for the quarter ended March 31, 2017. (1)  Defined as the sum of bank debt and Senior Secured Notes plus (minus) the working capital deficit (surplus) excluding the current portion of the fair value of the financial instruments. (2) Represents the full dilution of all outstanding options and warrants. Delphi continues to execute the accelerated development plan of its liquids-rich Montney property (“Bigstone Montney”) located at Bigstone in northwest Alberta, with two drilling rigs continuing to operate through spring break up on separate pad locations. The Company was able to execute on its entire planned first quarter capital program, and will be in a position to complete five (3.2 net) additional Montney wells as wet weather and spring break up conditions subside. Production in the first quarter of 2017 averaged 8,198 boe/d, weighted 40 percent to field condensate and natural gas liquids, compared to 8,395 boe/d during the first quarter of 2016. The Bigstone Montney production represented 86 percent or 7,050 boe/d of the Company’s corporate production during the first quarter of 2017. As a result of the successful drilling program, four gross (2.5 net) Montney wells were brought on-stream during the quarter, increasing corporate production during April 2017 to average approximately 10,000 boe/d. Current production capability remains at the upper end of our 2017 annual production guidance of 9,000 to 9,500 boe/d. The 14 percent or 854 boe/d increase in Bigstone Montney production to 7,050 boe/d in the first quarter of 2017 compared to the fourth quarter of 2016 was largely a result of a 33 percent or 773 bbls/d increase in field condensate and natural gas liquids production. Montney field and plant condensate yields averaged 91 bbls/mmcf of the total 130 bbls/mmcf liquids yield. Increased condensate yields are a result of continued frac innovations and delineation of the Bigstone Montney westward with the new wells being drilled. The Company’s successful operating margin growth is a result of the high quality Bigstone Montney asset base, majority ownership in strategic infrastructure, firm take away capacity and proven expertise in developing this liquids-rich asset. The Company generated an operating netback of $17.07 per boe before risk management contracts, up 150 percent from $6.82 per boe during the comparative quarter of 2016. During the first quarter of 2017, the Company invested gross field capital of $30.3 million. Net of carry capital costs of $9.1 million associated with the Partner Transaction already accounted for at December 31, 2016, the program was executed on budget. Delphi spent 78 percent of field capital on drilling, completing and equipping four gross (2.5 net) Montney wells at Bigstone. A pipeline loop was installed to the 7-11 facility to handle increased volumes being produced from the new wells that are extending the Montney development westward. In addition, the Company incurred costs to secure a 20 mmcf/d amine processing package and compressor for its amine project scheduled for commissioning in the first quarter of 2018. Drilling activity on the Company’s Bigstone Montney asset continues with operations largely complete on the 14-09-60-23W5 (“14-09”) well (62 percent working interest).  The 14-09 horizontal Montney well was drilled from spud to a total depth of 5,908 metres in a Company record 25 days.  Innovations to the drilling program have resulted in decreased drilling times, on this most recent well, by 14 percent compared to the average well in 2016.  These innovations will allow Delphi to absorb service cost inflation and maintain targeted drilling costs.  A 40 stage completion liner was installed in the 2,863 metre horizontal lateral.  Drilling operations continue in the horizontal lateral at the 16-18-59-23W5 (“16-18”) well (65 percent working interest) and are expected to be finished in the next two weeks.  The 14-09 and 16-18 wells are both the second wells drilled from each of their respective wellsite pads.  Completion operations on these two pads in addition to the 15-09-60-23W5 well (62 percent working interest) are scheduled to commence after spring break up utilizing the Company’s third and fourth generation frac designs. Adjusted funds from operations in the first quarter of 2017 were $8.2 million or $0.05 per basic and diluted share, unchanged from the comparative quarter of 2016. Realized cash netbacks during the first quarter of 2017 were $11.08 per boe, including a $(0.62) per boe loss on risk management contracts.  This compares to $10.72 per boe, including a $7.80 per boe realized gain on risk management contracts during the first quarter of 2016. Cash costs were higher in the first quarter due to a combination of non-recurring crown royalty, operating and general administrative charges, as well as higher crown royalty rates as a result of higher commodity prices, and additional pro-rated operating costs for the scheduled SemCAMS K3 processing plant turnaround in the second quarter of 2017. At March 31, 2017, the Company had bank debt of $32.0 million and a working capital deficit of $23.1 million. Including the Senior Secured Notes, the Company had total net debt of $108.4 million. As at March 31, 2017, Delphi had $42.2 million (net of outstanding letters of credit) available to be drawn on its $80 million senior credit facility. The Company has approximately 22 million cubic feet per day (“mmcf/d”), or 65% of its remainder of 2017 forecast natural gas production hedged at an average price of CDN$4.20 per million British thermal units (“mmbtu”) and approximately 900 bbls/d of condensate hedged at an average WTI price of CDN$66.67 per barrel. Delphi has mitigated the persistent widening of the AECO and Station 2 basis differentials by contracting most of its gas into the Chicago market where pricing has materially outperformed local western Canada pricing, even with the incremental transportation costs. * Based on average 2017 production of 33.5 mmcf/d of natural gas and 2,150 bbls/d of field condensate. The Company continues to forecast absolute and per share growth across all measures during 2017, while maintaining balance sheet strength. The 2017 guidance is highlighted by a significant increase in drilling activity. Delphi has secured the required firm service transportation for 100 percent of forecasted 2017 natural gas production growth. The contracted Alliance full path service to Chicago with its incremental priority interruptible service handles approximately 95 percent of the Company’s natural gas sales, and together with the existing and incremental 2018 contracted firm TCPL service, will provide the Company with firm service to handle accelerated growth plans beyond 2017. Delphi’s Bigstone Montney field compression and dehydration facilities are also sufficient for the forecasted growth in 2017. Delphi will have five (3.2 net) Montney wells ready to complete and bring on production over the next two months as spring break up conditions subside and has plans to drill an additional five (3.3 net) wells during the second half of 2017. To handle the Company’s growing production volumes beyond 2017, Delphi is working to cost effectively expand its existing Montney field dehydration and compression capacity at East and South Bigstone. Delphi is well positioned to achieve increased production, cash flow and reserve growth over the near and long term to the benefit of all our stakeholders. The existing Board of Directors looks forward to the addition of Mr. Glenn A. Hamilton, Mr. Peter T. Harrison, and Mr. Ian Wild to the Board of Directors. “Glenn, Peter and Ian bring tremendous depth to our Board with their extensive experience in oil and gas accounting, finance, banking and investment,” said David J. Reid, President and CEO. “And together with the Company’s new CFO, Mr. Mark Behrman, we have significantly strengthened our team to continue to successfully pursue ambitious growth plans”. On behalf of the Board of Directors and all the employees of Delphi, we would like to thank our shareholders for their continued support. A conference call and webcast to review first quarter 2017 results is scheduled for 9:00 a.m. Mountain Time (11:00 a.m. Eastern Time) on Thursday, May 11, 2017.  The conference call number is 1-844-358-8760. A brief presentation by David J. Reid, President and CEO and Mark D. Behrman, CFO, will be followed by a question and answer period.  The conference call will also be broadcast live on the internet and may be accessed through Delphi’s website at www.delphienergy.ca or by entering http://edge.media-server.com/m/p/qmudsd6g in your web browser. A rebroadcast will also be available on Delphi’s website or at http://edge.media-server.com/m/p/qmudsd6g on your web browser. This news release does not constitute an offer to sell or a solicitation of any offer to buy the securities in the United States. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended and will not be offered or sold in the United States absent an exemption from the registration requirements thereof. The Company also announces that its Annual General Meeting (“AGM”) will be held on Thursday, May 18, 2017 at 3:00pm (MST) in the Devonian Room at the Calgary Petroleum Club (319 – 5 Avenue S.W.).  Shareholders are encouraged to attend. This news release does not constitute an offer to sell or a solicitation of any offer to buy the securities in the United States. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended and will not be offered or sold in the United States absent an exemption from the registration requirements thereof. Delphi Energy Corp. is an industry-leading producer of liquids-rich natural gas.  The Company has achieved top decile results through the development of our high quality Montney property, uniquely positioned in the Deep Basin of Bigstone, in northwest Alberta. Delphi continues to outperform key industry players by improving operational efficiencies and growing our dominant Bigstone land position in this world-class play. Delphi is headquartered in Calgary, Alberta and trades on the Toronto Stock Exchange under the symbol DEE. Forward-Looking Statements.  This news release contains forward-looking statements and forward-looking information within the meaning of applicable Canadian securities laws.  These statements relate to future events or the Company’s future performance and are based upon the Company’s internal assumptions and expectations.  All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “may”, “will”, “should”, “believe”, "intends”, “forecast”, “plans”, “guidance”, “budget” and similar expressions. More particularly and without limitation, this release contains forward-looking statements and information relating to petroleum and natural gas production estimates and weighting, projected crude oil and natural gas prices, future exchange rates, expectations as to royalty rates, expectations as to transportation and operating costs, expectations as to general and administrative costs and interest expense, expectations as to capital expenditures and net debt, planned capital spending, future liquidity and Delphi’s ability to fund ongoing capital requirements through operating cash flows and its credit facilities, supply and demand fundamentals for oil and gas commodities, timing and success of development and exploitation activities, cash availability for the financing of capital expenditures, access to third-party infrastructure, treatment under governmental regulatory regimes and tax laws and future environmental regulations. Furthermore, statements relating to “reserves” are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitable in the future. The forward-looking statements and information contained in this release are based on certain key expectations and assumptions made by Delphi.  The following are certain material assumptions on which the forward-looking statements and information contained in this release are based: the stability of the global and national economic environment, the stability of and commercial acceptability of tax, royalty and regulatory regimes applicable to Delphi, exploitation and development activities being consistent with management’s expectations, production levels of Delphi being consistent with management’s expectations, the absence of significant project delays, the stability of oil and gas prices, the absence of significant fluctuations in foreign exchange rates and interest rates, the stability of costs of oil and gas development and production in Western Canada, including operating costs, the timing and size of development plans and capital expenditures, availability of third party infrastructure for transportation, processing or marketing of oil and natural gas volumes, prices and availability of oilfield services and equipment being consistent with management’s expectations, the availability of, and competition for, among other things, pipeline capacity, skilled personnel and drilling and related services and equipment, results of development and exploitation activities that are consistent with management’s expectations, weather affecting Delphi’s ability to develop and produce as expected, contracted parties providing goods and services on the agreed timeframes, Delphi’s ability to manage environmental risks and hazards and the cost of complying with environmental regulations, the accuracy of operating cost estimates, the accurate estimation of oil and gas reserves, future exploitation, development and production results and Delphi’s ability to market oil and natural gas successfully to current and new customers. Additionally, estimates as to expected average annual production rates assume that no unexpected outages occur in the infrastructure that the Company relies on to produce its wells, that existing wells continue to meet production expectations and any future wells scheduled to come on in the coming year meet timing and production expectations. Commodity prices used in the determination of forecast revenues are based upon general economic conditions, commodity supply and demand forecasts and publicly available price forecasts. The Company continually monitors its forecast assumptions to ensure the stakeholders are informed of material variances from previously communicated expectations. Financial outlook information contained in this release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management’s assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this release should not be used for purposes other than for which it is disclosed. Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent known and unknown risks and uncertainties.  Delphi’s actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits Delphi will derive therefrom. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those currently anticipated due to a number of factors and risks.  These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of estimates and projections relating to production rates, costs and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition from others for scarce resources, the ability to access sufficient capital from internal and external sources, changes in governmental regulation of the oil and gas industry and changes in tax, royalty and environmental legislation.  Additional information on these and other factors that could affect the Company’s operations or financial results are included in the Company’s most recent Annual Information Form and other reports on file with the applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). Readers are cautioned that the foregoing list of factors is not exhaustive.  Furthermore, the forward-looking statements contained in this release are made as of the date of this release for the purpose of providing the readers with the Company’s expectations for the coming year.  The forward-looking statements and information may not be appropriate for other purposes.  Delphi undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.  The forward-looking statements contained in this release are expressly qualified in their entirety by this cautionary statement. Basis of Presentation.  For the purpose of reporting production information, reserves and calculating unit prices and costs, natural gas volumes have been converted to a barrel of oil equivalent (boe) using six thousand cubic feet equal to one barrel.  A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.  This conversion conforms to the Canadian Securities Administrators’ National Instrument 51-101 when boes are disclosed.  Boes may be misleading, particularly if used in isolation. As per CSA Staff Notice 51-327 initial test results and initial production performance should be considered preliminary data and such data is not necessarily indicative of long-term performance or of ultimate recovery. Non-IFRS Measures.  The release contains the terms “funds from operations”, “funds from operations per share”, “net debt”, “net debt to funds from operations ratio”, “operating netbacks” “cash netbacks” and “netbacks” which are not recognized measures under IFRS.  The Company uses these measures to help evaluate its performance.  Management considers netbacks an important measure as it demonstrates its profitability relative to current commodity prices and costs of production. Management uses funds from operations to analyze performance and considers it a key measure as it demonstrates the Company’s ability to generate the cash necessary to fund future capital investments and to repay debt. Funds from operations is a non-IFRS measure and has been defined by the Company as cash flow from operating activities before accretion on long term and subordinated debt, decommissioning expenditures and changes in non-cash working capital from operating activities. The Company also presents funds from operations per share whereby amounts per share are calculated using weighted average shares outstanding consistent with the calculation of earnings per share. Delphi’s determination of funds from operations may not be comparable to that reported by other companies nor should it be viewed as an alternative to cash flow from operating activities, net earnings or other measures of financial performance calculated in accordance with IFRS.  The Company has defined net debt as the sum of long term debt and subordinated debt plus/minus working capital excluding the current portion of the fair value of financial instruments. Net debt is used by management to monitor remaining availability under its credit facilities. Net debt to funds from operations ratio is defined as net debt to annualized quarterly funds from operations, based on the most recently completed quarter.  This ratio is used to calculate the Company’s compliance with its net debt to funds from operations ratio covenant.  Operating netbacks have been defined as revenue less royalties, transportation and operating costs.  Cash netbacks have been defined as operating netbacks less interest and general and administrative costs.  Netbacks are generally discussed and presented on a per boe basis. Financial outlook information contained in this release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management’s assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this release should not be used for purposes other than for which it is disclosed. Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent known and unknown risks and uncertainties.  Delphi’s actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits Delphi will derive therefrom. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those currently anticipated due to a number of factors and risks.  These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of estimates and projections relating to production rates, costs and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition from others for scarce resources, the ability to access sufficient capital from internal and external sources, changes in governmental regulation of the oil and gas industry and changes in tax, royalty and environmental legislation.  Additional information on these and other factors that could affect the Company’s operations or financial results are included in the Company’s most recent Annual Information Form and other reports on file with the applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). Readers are cautioned that the foregoing list of factors is not exhaustive.  Furthermore, the forward-looking statements contained in this release are made as of the date of this release for the purpose of providing the readers with the Company’s expectations for the coming year.  The forward-looking statements and information may not be appropriate for other purposes.  Delphi undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.  The forward-looking statements contained in this release are expressly qualified in their entirety by this cautionary statement. Basis of Presentation.  For the purpose of reporting production information, reserves and calculating unit prices and costs, natural gas volumes have been converted to a barrel of oil equivalent (boe) using six thousand cubic feet equal to one barrel.  A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.  This conversion conforms with the Canadian Securities Administrators’ National Instrument 51-101 when boes are disclosed.  Boes may be misleading, particularly if used in isolation. As per CSA Staff Notice 51-327 initial test results and initial production performance should be considered preliminary data and such data is not necessarily indicative of long-term performance or of ultimate recovery. For the calculation of finding, development and acquisition costs, recycle ratio and net asset value per share, refer to the Company’s press release of crude oil and natural gas reserves information dated February 29, 2016. Delphi Energy’s crude oil, natural gas and natural gas liquid reserves information for the year ended December 31, 2015 was press released on February 29, 2016.  Information relating to reserves and reserve metrics can be found in this press release.


News Article | May 11, 2017
Site: globenewswire.com

CALGARY, Alberta, May 10, 2017 (GLOBE NEWSWIRE) -- Delphi Energy Corp. (“Delphi” or the “Company”) is pleased to announce its financial and operational results for the quarter ended March 31, 2017. (1)  Defined as the sum of bank debt and Senior Secured Notes plus (minus) the working capital deficit (surplus) excluding the current portion of the fair value of the financial instruments. (2) Represents the full dilution of all outstanding options and warrants. Delphi continues to execute the accelerated development plan of its liquids-rich Montney property (“Bigstone Montney”) located at Bigstone in northwest Alberta, with two drilling rigs continuing to operate through spring break up on separate pad locations. The Company was able to execute on its entire planned first quarter capital program, and will be in a position to complete five (3.2 net) additional Montney wells as wet weather and spring break up conditions subside. Production in the first quarter of 2017 averaged 8,198 boe/d, weighted 40 percent to field condensate and natural gas liquids, compared to 8,395 boe/d during the first quarter of 2016. The Bigstone Montney production represented 86 percent or 7,050 boe/d of the Company’s corporate production during the first quarter of 2017. As a result of the successful drilling program, four gross (2.5 net) Montney wells were brought on-stream during the quarter, increasing corporate production during April 2017 to average approximately 10,000 boe/d. Current production capability remains at the upper end of our 2017 annual production guidance of 9,000 to 9,500 boe/d. The 14 percent or 854 boe/d increase in Bigstone Montney production to 7,050 boe/d in the first quarter of 2017 compared to the fourth quarter of 2016 was largely a result of a 33 percent or 773 bbls/d increase in field condensate and natural gas liquids production. Montney field and plant condensate yields averaged 91 bbls/mmcf of the total 130 bbls/mmcf liquids yield. Increased condensate yields are a result of continued frac innovations and delineation of the Bigstone Montney westward with the new wells being drilled. The Company’s successful operating margin growth is a result of the high quality Bigstone Montney asset base, majority ownership in strategic infrastructure, firm take away capacity and proven expertise in developing this liquids-rich asset. The Company generated an operating netback of $17.07 per boe before risk management contracts, up 150 percent from $6.82 per boe during the comparative quarter of 2016. During the first quarter of 2017, the Company invested gross field capital of $30.3 million. Net of carry capital costs of $9.1 million associated with the Partner Transaction already accounted for at December 31, 2016, the program was executed on budget. Delphi spent 78 percent of field capital on drilling, completing and equipping four gross (2.5 net) Montney wells at Bigstone. A pipeline loop was installed to the 7-11 facility to handle increased volumes being produced from the new wells that are extending the Montney development westward. In addition, the Company incurred costs to secure a 20 mmcf/d amine processing package and compressor for its amine project scheduled for commissioning in the first quarter of 2018. Drilling activity on the Company’s Bigstone Montney asset continues with operations largely complete on the 14-09-60-23W5 (“14-09”) well (62 percent working interest).  The 14-09 horizontal Montney well was drilled from spud to a total depth of 5,908 metres in a Company record 25 days.  Innovations to the drilling program have resulted in decreased drilling times, on this most recent well, by 14 percent compared to the average well in 2016.  These innovations will allow Delphi to absorb service cost inflation and maintain targeted drilling costs.  A 40 stage completion liner was installed in the 2,863 metre horizontal lateral.  Drilling operations continue in the horizontal lateral at the 16-18-59-23W5 (“16-18”) well (65 percent working interest) and are expected to be finished in the next two weeks.  The 14-09 and 16-18 wells are both the second wells drilled from each of their respective wellsite pads.  Completion operations on these two pads in addition to the 15-09-60-23W5 well (62 percent working interest) are scheduled to commence after spring break up utilizing the Company’s third and fourth generation frac designs. Adjusted funds from operations in the first quarter of 2017 were $8.2 million or $0.05 per basic and diluted share, unchanged from the comparative quarter of 2016. Realized cash netbacks during the first quarter of 2017 were $11.08 per boe, including a $(0.62) per boe loss on risk management contracts.  This compares to $10.72 per boe, including a $7.80 per boe realized gain on risk management contracts during the first quarter of 2016. Cash costs were higher in the first quarter due to a combination of non-recurring crown royalty, operating and general administrative charges, as well as higher crown royalty rates as a result of higher commodity prices, and additional pro-rated operating costs for the scheduled SemCAMS K3 processing plant turnaround in the second quarter of 2017. At March 31, 2017, the Company had bank debt of $32.0 million and a working capital deficit of $23.1 million. Including the Senior Secured Notes, the Company had total net debt of $108.4 million. As at March 31, 2017, Delphi had $42.2 million (net of outstanding letters of credit) available to be drawn on its $80 million senior credit facility. The Company has approximately 22 million cubic feet per day (“mmcf/d”), or 65% of its remainder of 2017 forecast natural gas production hedged at an average price of CDN$4.20 per million British thermal units (“mmbtu”) and approximately 900 bbls/d of condensate hedged at an average WTI price of CDN$66.67 per barrel. Delphi has mitigated the persistent widening of the AECO and Station 2 basis differentials by contracting most of its gas into the Chicago market where pricing has materially outperformed local western Canada pricing, even with the incremental transportation costs. * Based on average 2017 production of 33.5 mmcf/d of natural gas and 2,150 bbls/d of field condensate. The Company continues to forecast absolute and per share growth across all measures during 2017, while maintaining balance sheet strength. The 2017 guidance is highlighted by a significant increase in drilling activity. Delphi has secured the required firm service transportation for 100 percent of forecasted 2017 natural gas production growth. The contracted Alliance full path service to Chicago with its incremental priority interruptible service handles approximately 95 percent of the Company’s natural gas sales, and together with the existing and incremental 2018 contracted firm TCPL service, will provide the Company with firm service to handle accelerated growth plans beyond 2017. Delphi’s Bigstone Montney field compression and dehydration facilities are also sufficient for the forecasted growth in 2017. Delphi will have five (3.2 net) Montney wells ready to complete and bring on production over the next two months as spring break up conditions subside and has plans to drill an additional five (3.3 net) wells during the second half of 2017. To handle the Company’s growing production volumes beyond 2017, Delphi is working to cost effectively expand its existing Montney field dehydration and compression capacity at East and South Bigstone. Delphi is well positioned to achieve increased production, cash flow and reserve growth over the near and long term to the benefit of all our stakeholders. The existing Board of Directors looks forward to the addition of Mr. Glenn A. Hamilton, Mr. Peter T. Harrison, and Mr. Ian Wild to the Board of Directors. “Glenn, Peter and Ian bring tremendous depth to our Board with their extensive experience in oil and gas accounting, finance, banking and investment,” said David J. Reid, President and CEO. “And together with the Company’s new CFO, Mr. Mark Behrman, we have significantly strengthened our team to continue to successfully pursue ambitious growth plans”. On behalf of the Board of Directors and all the employees of Delphi, we would like to thank our shareholders for their continued support. A conference call and webcast to review first quarter 2017 results is scheduled for 9:00 a.m. Mountain Time (11:00 a.m. Eastern Time) on Thursday, May 11, 2017.  The conference call number is 1-844-358-8760. A brief presentation by David J. Reid, President and CEO and Mark D. Behrman, CFO, will be followed by a question and answer period.  The conference call will also be broadcast live on the internet and may be accessed through Delphi’s website at www.delphienergy.ca or by entering http://edge.media-server.com/m/p/qmudsd6g in your web browser. A rebroadcast will also be available on Delphi’s website or at http://edge.media-server.com/m/p/qmudsd6g on your web browser. This news release does not constitute an offer to sell or a solicitation of any offer to buy the securities in the United States. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended and will not be offered or sold in the United States absent an exemption from the registration requirements thereof. The Company also announces that its Annual General Meeting (“AGM”) will be held on Thursday, May 18, 2017 at 3:00pm (MST) in the Devonian Room at the Calgary Petroleum Club (319 – 5 Avenue S.W.).  Shareholders are encouraged to attend. This news release does not constitute an offer to sell or a solicitation of any offer to buy the securities in the United States. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended and will not be offered or sold in the United States absent an exemption from the registration requirements thereof. Delphi Energy Corp. is an industry-leading producer of liquids-rich natural gas.  The Company has achieved top decile results through the development of our high quality Montney property, uniquely positioned in the Deep Basin of Bigstone, in northwest Alberta. Delphi continues to outperform key industry players by improving operational efficiencies and growing our dominant Bigstone land position in this world-class play. Delphi is headquartered in Calgary, Alberta and trades on the Toronto Stock Exchange under the symbol DEE. Forward-Looking Statements.  This news release contains forward-looking statements and forward-looking information within the meaning of applicable Canadian securities laws.  These statements relate to future events or the Company’s future performance and are based upon the Company’s internal assumptions and expectations.  All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “may”, “will”, “should”, “believe”, "intends”, “forecast”, “plans”, “guidance”, “budget” and similar expressions. More particularly and without limitation, this release contains forward-looking statements and information relating to petroleum and natural gas production estimates and weighting, projected crude oil and natural gas prices, future exchange rates, expectations as to royalty rates, expectations as to transportation and operating costs, expectations as to general and administrative costs and interest expense, expectations as to capital expenditures and net debt, planned capital spending, future liquidity and Delphi’s ability to fund ongoing capital requirements through operating cash flows and its credit facilities, supply and demand fundamentals for oil and gas commodities, timing and success of development and exploitation activities, cash availability for the financing of capital expenditures, access to third-party infrastructure, treatment under governmental regulatory regimes and tax laws and future environmental regulations. Furthermore, statements relating to “reserves” are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitable in the future. The forward-looking statements and information contained in this release are based on certain key expectations and assumptions made by Delphi.  The following are certain material assumptions on which the forward-looking statements and information contained in this release are based: the stability of the global and national economic environment, the stability of and commercial acceptability of tax, royalty and regulatory regimes applicable to Delphi, exploitation and development activities being consistent with management’s expectations, production levels of Delphi being consistent with management’s expectations, the absence of significant project delays, the stability of oil and gas prices, the absence of significant fluctuations in foreign exchange rates and interest rates, the stability of costs of oil and gas development and production in Western Canada, including operating costs, the timing and size of development plans and capital expenditures, availability of third party infrastructure for transportation, processing or marketing of oil and natural gas volumes, prices and availability of oilfield services and equipment being consistent with management’s expectations, the availability of, and competition for, among other things, pipeline capacity, skilled personnel and drilling and related services and equipment, results of development and exploitation activities that are consistent with management’s expectations, weather affecting Delphi’s ability to develop and produce as expected, contracted parties providing goods and services on the agreed timeframes, Delphi’s ability to manage environmental risks and hazards and the cost of complying with environmental regulations, the accuracy of operating cost estimates, the accurate estimation of oil and gas reserves, future exploitation, development and production results and Delphi’s ability to market oil and natural gas successfully to current and new customers. Additionally, estimates as to expected average annual production rates assume that no unexpected outages occur in the infrastructure that the Company relies on to produce its wells, that existing wells continue to meet production expectations and any future wells scheduled to come on in the coming year meet timing and production expectations. Commodity prices used in the determination of forecast revenues are based upon general economic conditions, commodity supply and demand forecasts and publicly available price forecasts. The Company continually monitors its forecast assumptions to ensure the stakeholders are informed of material variances from previously communicated expectations. Financial outlook information contained in this release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management’s assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this release should not be used for purposes other than for which it is disclosed. Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent known and unknown risks and uncertainties.  Delphi’s actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits Delphi will derive therefrom. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those currently anticipated due to a number of factors and risks.  These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of estimates and projections relating to production rates, costs and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition from others for scarce resources, the ability to access sufficient capital from internal and external sources, changes in governmental regulation of the oil and gas industry and changes in tax, royalty and environmental legislation.  Additional information on these and other factors that could affect the Company’s operations or financial results are included in the Company’s most recent Annual Information Form and other reports on file with the applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). Readers are cautioned that the foregoing list of factors is not exhaustive.  Furthermore, the forward-looking statements contained in this release are made as of the date of this release for the purpose of providing the readers with the Company’s expectations for the coming year.  The forward-looking statements and information may not be appropriate for other purposes.  Delphi undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.  The forward-looking statements contained in this release are expressly qualified in their entirety by this cautionary statement. Basis of Presentation.  For the purpose of reporting production information, reserves and calculating unit prices and costs, natural gas volumes have been converted to a barrel of oil equivalent (boe) using six thousand cubic feet equal to one barrel.  A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.  This conversion conforms to the Canadian Securities Administrators’ National Instrument 51-101 when boes are disclosed.  Boes may be misleading, particularly if used in isolation. As per CSA Staff Notice 51-327 initial test results and initial production performance should be considered preliminary data and such data is not necessarily indicative of long-term performance or of ultimate recovery. Non-IFRS Measures.  The release contains the terms “funds from operations”, “funds from operations per share”, “net debt”, “net debt to funds from operations ratio”, “operating netbacks” “cash netbacks” and “netbacks” which are not recognized measures under IFRS.  The Company uses these measures to help evaluate its performance.  Management considers netbacks an important measure as it demonstrates its profitability relative to current commodity prices and costs of production. Management uses funds from operations to analyze performance and considers it a key measure as it demonstrates the Company’s ability to generate the cash necessary to fund future capital investments and to repay debt. Funds from operations is a non-IFRS measure and has been defined by the Company as cash flow from operating activities before accretion on long term and subordinated debt, decommissioning expenditures and changes in non-cash working capital from operating activities. The Company also presents funds from operations per share whereby amounts per share are calculated using weighted average shares outstanding consistent with the calculation of earnings per share. Delphi’s determination of funds from operations may not be comparable to that reported by other companies nor should it be viewed as an alternative to cash flow from operating activities, net earnings or other measures of financial performance calculated in accordance with IFRS.  The Company has defined net debt as the sum of long term debt and subordinated debt plus/minus working capital excluding the current portion of the fair value of financial instruments. Net debt is used by management to monitor remaining availability under its credit facilities. Net debt to funds from operations ratio is defined as net debt to annualized quarterly funds from operations, based on the most recently completed quarter.  This ratio is used to calculate the Company’s compliance with its net debt to funds from operations ratio covenant.  Operating netbacks have been defined as revenue less royalties, transportation and operating costs.  Cash netbacks have been defined as operating netbacks less interest and general and administrative costs.  Netbacks are generally discussed and presented on a per boe basis. Financial outlook information contained in this release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management’s assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this release should not be used for purposes other than for which it is disclosed. Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent known and unknown risks and uncertainties.  Delphi’s actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits Delphi will derive therefrom. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those currently anticipated due to a number of factors and risks.  These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of estimates and projections relating to production rates, costs and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition from others for scarce resources, the ability to access sufficient capital from internal and external sources, changes in governmental regulation of the oil and gas industry and changes in tax, royalty and environmental legislation.  Additional information on these and other factors that could affect the Company’s operations or financial results are included in the Company’s most recent Annual Information Form and other reports on file with the applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). Readers are cautioned that the foregoing list of factors is not exhaustive.  Furthermore, the forward-looking statements contained in this release are made as of the date of this release for the purpose of providing the readers with the Company’s expectations for the coming year.  The forward-looking statements and information may not be appropriate for other purposes.  Delphi undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.  The forward-looking statements contained in this release are expressly qualified in their entirety by this cautionary statement. Basis of Presentation.  For the purpose of reporting production information, reserves and calculating unit prices and costs, natural gas volumes have been converted to a barrel of oil equivalent (boe) using six thousand cubic feet equal to one barrel.  A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.  This conversion conforms with the Canadian Securities Administrators’ National Instrument 51-101 when boes are disclosed.  Boes may be misleading, particularly if used in isolation. As per CSA Staff Notice 51-327 initial test results and initial production performance should be considered preliminary data and such data is not necessarily indicative of long-term performance or of ultimate recovery. For the calculation of finding, development and acquisition costs, recycle ratio and net asset value per share, refer to the Company’s press release of crude oil and natural gas reserves information dated February 29, 2016. Delphi Energy’s crude oil, natural gas and natural gas liquid reserves information for the year ended December 31, 2015 was press released on February 29, 2016.  Information relating to reserves and reserve metrics can be found in this press release.

Loading MST Inc collaborators
Loading MST Inc collaborators