Evolution Petroleum (US:EPM)2020-11-06 22:10Financial Data and Key Metrics Changes - The company recorded revenues of $5.6 million for the first fiscal quarter of 2021, representing a 67% increase from the prior quarter [9] - The average daily net production decreased by approximately 4% to 18.41 barrels of oil equivalent per day due to CO2 purchase suspensions and maintenance downtime [16] - A significant non-cash impairment charge of $9.6 million was recorded, primarily due to lower oil prices [19][22] - The net loss for the quarter was $7.1 million, or approximately $0.22 per diluted share, compared to a net loss of $2.3 million, or $0.07 per diluted share, in the prior quarter [26] Business Line Data and Key Metrics Changes - The company focused on cash flow and total shareholder return, maintaining a long-standing dividend program, marking the 28th consecutive quarter of cash dividends [8][10] - Lease operating expenses increased by about 4.9% to $2.4 million, primarily due to increased activity at Hamilton Dome and Delhi fields [24] Market Data and Key Metrics Changes - The average realized oil price was approximately $37 per barrel, with Delhi's realized oil price about $2.20 per barrel below WTI [16][17] - The company expects continued volatility in oil prices due to the global COVID-19 pandemic affecting supply and demand [7] Company Strategy and Development Direction - The company aims to create long-term shareholder returns and is well-positioned to take advantage of potential opportunities arising from the current market conditions [8] - The company plans to invest in the development of Phase 5 at Delhi, with expected expenditures of approximately $1.9 million in fiscal 2021 [39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term value of the company's asset portfolio despite the current challenges in the oil and gas sector [14][23] - The company anticipates a gradual increase in production as CO2 volumes are restored at Delhi, which is expected to help arrest the decline in oil production [36] Other Important Information - The company maintains a strong liquidity position with $19.8 million in cash and an undrawn credit facility of $23 million [30] - The CFO, David Joe, announced his retirement, with Ryan Stash appointed as his successor [32][34] Q&A Session Summary Question: Can you touch on deal flow and asset characteristics? - Management indicated interest in both oil and gas assets, particularly long-life oil assets like Hamilton Dome and Delhi, while also exploring gas opportunities in East Texas and North Louisiana [45][46] Question: What is the outlook for cash taxes? - Management expects not to be a cash taxpayer in the current fiscal year due to projected losses, but cash taxes could return if oil prices rise significantly [50][51] Question: Will the income tax receivable be collected? - Management confirmed expectations to receive the income tax refund from federal taxpayers, primarily related to previous tax credits [52][53] Question: Can gross production volumes be provided? - Management stated that gross production volumes would be included in the upcoming 10-Q filing [55]