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Surge Energy Inc. Announces Intended 15 Percent Increase to its Dividend - On Growing Production Volumes and Free Funds Flow
Surge Energy Inc. Announces Intended 15 Percent Increase to its Dividend - On Growing Prod...
About this update from Surge Energy Inc.
[{"type":"text","content":"\n\n\n\nSurge Energy Inc. Announces Intended 15 Percent Increase to its Dividend - On Growing Production Volumes and Free Funds Flow\n\n/* Style Definitions */\nspan.prnews_span\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\na.prnews_a\n{\ncolor:blue;\n}\nli.prnews_li\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\np.prnews_p\n{\nfont-size:0.62em;\nfont-family:\"Arial\";\ncolor:black;\nmargin:0in;\n}\n\n\n\n\n\n\n\nCanada NewsWire\nCALGARY, Feb. 8, 2017\n\n\n\nCALGARY, Feb. 8, 2017 /CNW/ - Surge Energy Inc. (\"Surge\" or the \"Company\") (TSX: SGY) announces the Company's intention to increase its dividend from $0.075 per year ($0.00625 per month) to $0.085 per year ($0.00708 per month) effective March 15th, 2017. \n\nSurge continues to experience increasing production volumes, as a result of continued excellent drilling and waterflood results at its three core properties at Shaunavon, Sparky, and Valhalla. On December 13, 2016 Surge upwardly revised the Company's 2017 average daily production estimate to 14,000 boepd from 13,500 boepd, and the Company's 2017 exit production to 14,450 boepd from 14,000 boepd.\n\nManagement confirms that Surge's December, 2016 production averaged more than 13,800 boepd – well above the Company's 2016 exit rate production guidance of 13,500 boepd. Surge anticipates 13.5 net wells will be brought on production before spring break-up at the Company's three core assets.\n\nOn this basis, Surge now anticipates delivering more than 18 percent production per share growth over the period from Q2/2016 to the end of 2017 (i.e. greater than 10 percent annualized).\n\nThese consistent operational results and top tier production efficiencies, combined with successful, ongoing cost-cutting initiatives for operating expenses, G&A, and interest expense, provide the Company with meaningful excess \"free\" funds flow (i.e. over and above the Company's 2017 $85 million capital expenditure program, and the present dividend of $17 million) – at the Company's budget 2017 crude oil pricing assumption1. Surge's current dividend represents a conservative simple payout ratio of less than 13.6 percent of forecast 2017 funds flow.\n\nAccordingly, with the ongoing protection from Surge's strategic commodity hedging program, and a forward debt to funds flow ratio of less than ...