Business
Compton reports third quarter 2009 results
Compton reports third quarter 2009 results
About this update from Cullinan Metals Corp
[{"type":"text","content":"\n\n\n\nNov. 6, 2009 (Canada NewsWire Group) -- CALGARY, Nov. 6 /CNW/ -- Compton Petroleum Corporation (TSX - CMT, NYSE - CMZ) reports its financial and operating results for the three months ended September 30, 2009.The full text of Management's Discussion and Analysis (\"MD&A\") and the Corporation's audited consolidated financial statements can be found on the Corporation's website at www.comptonpetroleum.com and at www.sedar.com.Summary of Quarterly Performance- Cash flow of $7.3 million, or $0.06 per diluted share- Operating loss was $19.1 million, largely due to depletion anddepreciation- Net earnings of $13.0 million, or $0.10 per diluted share- Average production was 19,760 boe/d- Capital expenditures of $8.3 million, before acquisitions anddivestituresDepressed natural gas prices continued to impact Compton's financial performance throughout the quarter. In this environment, Compton remains focused on its defensive strategy of living within cash flow until a clear signal that the recovery of commodity prices is evident.A key challenge for Compton in 2009 has been to realign and strengthen its capital structure, with the objective of significantly reducing its overall debt level in order to be able to realize future value for shareholders from the Corporation's significant portfolio of assets. Compton has taken a multi-faceted, staged approach to recapitalization, which is intended to support the needs of all stakeholders.In September 2009, Compton announced two significant transactions that have reduced the Corporation's total debt level:- an equity issue of 138 million units composed of one common share andone share purchase warrant for net proceeds of $161.4 million; and- the sale of various overriding royalties for total gross proceeds of$54.5 million with an option for an additional $47.5 million.Proceeds from these transactions have been used to decrease the Corporation's debt level. Taking into account the proceeds from the equity issue and the overriding royalty sales, total bank debt and senior notes has been reduced by 26% to $594.0 million from $802.8 million at the end of the third quarter. Should the option be exercised, total bank debt and senior notes would be reduced by 32% to $546.5 million by year-end. These are positive steps that have provided increased financial stability and liquidity while decreasi...