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Toreador Resources 8-K 2007

Exhibit 99.1


 

TOREADOR ANNOUNCES THIRD QUARTER AND FIRST NINE MONTHS OF 2007 FINANCIAL RESULTS

 

Third quarter revenue increase of 41% primarily due to new natural gas production and higher oil prices

Operating loss of $10.9 million primarily due to exploration expenses and dry hole costs of $9.1 million

EBITDAX* increase of 7% from same quarter last year

Non-cash currency translation loss of $13.6 million due to re-valuation of Turkish assets as dollar weakens against lira

Cash balance at the end of the third quarter was $20.4 million

 


 

DALLAS, TEXAS – (November 9, 2007) – Toreador Resources Corporation (NASDAQ: TRGL) today announced third quarter and first nine months of 2007 financial results.

THIRD QUARTER 2007 FINANCIAL RESULTS

Third quarter 2007 revenues increased to $12.4 million from $8.8 million in the same period last year, a positive change of 41%, primarily due to new natural gas production from the South Akcakoca Sub-basin natural gas project offshore Turkey and an increase in realized oil prices in France. For the quarter ended September 30, 2007, Toreador reported earnings before interest, taxes, depreciation, amortization, and exploration expense (EBITDAX, a non-GAAP measure*) of $6.0 million compared to $5.6 million for the same period last year, a 7% increase.

Toreador recorded an operating loss in the third quarter of 2007 of $10.9 million, compared to operating income of $2.8 million in the same period last year. Compared to the prior year period, third quarter 2007 operating expenses increased primarily due to dry hole expenses of $4.3 million; an

 

Toreador Q3 2007 Financial Resultse, Nov. 9, 2007

Page 2 of 7

 

 

increase in the non-cash depreciation, depletion and amortization expense of $4.4 million and lease operating expense of $767 thousand due to the start of production in Turkey and Romania; an increase in exploration expense of $4.9 million primarily due to the recently completed seismic program in Romania; an increase in G&A expense of $2.9 million primarily due to the cessation of capital expenditures associated with the start of production in Turkey and the related inability to capitalize G&A; and a loss of $207 thousand on oil derivative contracts. G&A expense, net of stock compensation expense, was $4.4 million in the third quarter of 2007, but is expected to decrease as the second phase of development of the South Akcakoca Sub-basin project starts in Turkey and overhead associated with the project is capitalized.

For the three months ended September 30, 2007, the company reported a loss available to common shares of $20.8 million, or $1.09 per diluted share, compared to income available to common shares of $5.4 million in the third quarter of 2006, or $0.33 per diluted share. A non-cash foreign currency translation loss of $13.6 million due to the weakness of the dollar compared to the Turkish lira as well as the increase in operating expenses described above were the primary causes of the earnings decline.

Since the dollar is currently the functional currency in Turkey, whenever the dollar declines, the historical valuation of assets in Turkey must be adjusted downward to take into account the change in the exchange rates and the adjustment runs through the income statement as a foreign currency exchange loss. Conversely, if the dollar strengthens then the re-valuation of assets becomes a non-cash foreign currency gain. Once Turkish operations become self-sufficient, then the functional currency should change to the lira, and any asset re-valuations should be adjusted on the balance sheet through “other comprehensive income” and not on the income statement.

Diluted weighted average shares outstanding in the third quarter of 2007 were 19.2 million, compared to 18.7 million diluted weighted average shares outstanding in the third quarter of 2006.

Production Data for the Three Months Ended September 30,

 

2007

2006

 

2007

2006

Production:

Average Price:

Oil (MBbls):

Oil ($/Bbl):

France

94

104

France

$   71.23

$ 65.94

Turkey

17

20

Turkey

60.96

60.74

Romania

2

2

Romania

47.64

50.65

Total

113

126

Total

$   69.26

$ 64.82

Gas (MMcf):

Gas ($/Mcf):

France

-

-

France

$      -

$      -

Turkey

423

-

Turkey

8.50

-

Romania

168

192

Romania

5.28

3.50

Total

591

192

Total

$  7.58

$ 3.50

MBOE:

$/ BOE:

France

94

104

France

$   71.23

$ 65.94

Turkey

87

20

Turkey

52.94

60.74

Romania

30

34

Romania

32.78

23.12

Total

211

158

Total

$   58.21

$ 55.95

 

 

 

Toreador Q3 2007 Financial Resultse, Nov. 9, 2007

Page 3 of 7

 

 

FIRST NINE MONTHS OF 2007 FINANCIAL RESULTS


 

For the first nine months of 2007, revenues increased to $29.2 million compared to $25.4 million for the same period last year primarily due to new natural gas production in Turkey and Romania and oil price increases in France. In the nine months ended September 30, 2007, EBITDAX*was $10.6 million, compared to $16.6 million for the first nine months of 2006. An operating loss of $35.1 million for the first nine months of 2007 was primarily due to the factors described in the third quarter results, compared to a $6.8 million operating gain in the first nine months of 2006. G&A expense, net of stock compensation expense and executive severance expense, was $9.7 million year-to-date.

For the nine months ended September 30, 2007, a loss available to common shares of $54.7 million was recorded, or $3.03 per diluted share, compared to income available to common shares of $10.1 million, or $0.63 per diluted share for the first nine months of 2006.

 

For the Nine Months Ended September 30,

 

2007

2006

 

2007

2006

Production:

Average Price:

Oil (MBbls):

Oil ($/Bbl):

France

288

341

France

$   62.54

$ 63.26

Turkey

51

54

Turkey

54.88

56.83

Romania

8

2

Romania

54.58

50.65

Total

347

397

Total

$   61.24

$ 62.30

Gas (MMcf):

Gas ($/Mcf):

France

-

-

France

$      -

$      -

Turkey

625

-

Turkey

8.39

-

Romania

543

192

Romania

4.79

3.50

Total

1,168

192

Total

$     6.72

$ 3.50

MBOE:

$/ BOE:

France

288

341

France

$   62.54

$ 63.26

Turkey

155

54

Turkey

51.84

56.83

Romania

98

34

Romania

30.81

23.12

Total

541

429

Total

$   53.71

$ 59.23

 

 

 

 

Toreador Q3 2007 Financial Resultse, Nov. 9, 2007

Page 4 of 7

 

 

CONFERENCE CALL

A conference call to discuss third quarter 2007 results and current operational activities will be held today at 10:00 am Central, 11:00 am Eastern.

Active participants who wish to ask questions during the conference call should dial toll free 800-240-6709 (international dial 1-303-262-2143) approximately 10 minutes before the scheduled call time to access the call.

Those who wish only to listen to the live audio webcast may access the webcast via Toreador’s internet home page at www.toreador.net by selecting the “Investor Relations” link on the home page and then selecting the “Conference Calls” link.

Those unable to participate in the live call may hear a rebroadcast for up to twelve months after the conference call at www.toreador.net by selecting the “Investor Relations” link on the home page and then selecting the “Conference Calls” link or may dial toll-free 800-405-2236 (international dial 1-303-590-3000), passcode 11101314#, to listen to a replay of the call. Phone replays will be available for 14 days after the call.

 

ABOUT TOREADOR

Toreador Resources Corporation is an independent international energy company engaged in the acquisition, development, exploration and production of natural gas, crude oil and other income-producing minerals. The company holds interests in developed and undeveloped oil and gas properties in France, Hungary, Romania and Turkey. More information about Toreador may be found at the company's web site, www.toreador.net.

 

*Explanation and Reconciliation of Non-GAAP Financial Measures

Earnings before interest, taxes, depreciation, amortization and exploration expense (EBITDAX) is a non-GAAP measure presented because of its acceptance as an indicator of an oil and gas exploration and production company’s ability to internally fund exploration and development activities and to service or incur additional debt. EBITDAX should not be considered in isolation or as a substitute for operating income prepared in accordance with generally accepted accounting principles. The tables below reconcile EBITDAX with income from continuing operations as derived from the company’s financial information.

 

 

 

 

 

Toreador Q3 2007 Financial Resultse, Nov. 9, 2007

Page 5 of 7

 

 

Table 1: Reconciliation of EBITDAX to Net Income for the three months ended Sept. 30,

 


                  

Table 2: Reconciliation of EBITDAX to Net Income for the nine months ended Sept. 30,

 


Safe-Harbor Statement – Except for the historical information contained herein, the matters set forth in this news release are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Toreador intends that all such statements be subject to the "safe-harbor" provisions of those Acts. Many important risks, factors and conditions may cause Toreador's actual results to differ materially from those discussed in any such forward-looking statement. These risks include, but are not limited to, estimates of reserves, estimates of production, future commodity prices, exchange rates, interest rates, geological and political risks, drilling risks, product demand, transportation restrictions, actual recoveries of insurance proceeds, the ability of Toreador to obtain additional capital, and other risks and uncertainties described in the company's filings with the Securities and Exchange Commission. The historical results achieved by Toreador are not necessarily indicative of its future prospects. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

# # #

CONTACT:

Toreador Resources

 

Stewart P. Yee, VP Investor Relations

214-559-3933 or 800-966-2141

syee@toreador.net

 

Toreador Q3 2007 Financial Resultse, Nov. 9, 2007

Page 6 of 7

 

 

TOREADOR RESOURCES CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(Unaudited)

 

 

Three Months Ended

September 30,

 

2007

2006

 

 

 

Oil and natural gas sales

$ 12,400

$     8,835

 

 

 

Operating costs and expenses:

Lease operating

2,943

2,176

Exploration expense

4,812

-

Depreciation, depletion and amortization

6,098

1,702

Dry hole expense

4,250

-

General and administrative

5,013

2,144

Loss on oil and gas derivative contracts

207

-

Loss on sale of properties and other assets

-

11

Total operating costs and expenses

23,323

6,033

 

 

 

Operating income (loss)

(10,923)

2,802

 

 

 

Other income (expense):

Equity in earnings of unconsolidated investments

-

71

Foreign currency exchange gain (loss)

(13,576)

2,736

Interest and other income

283

545

Interest expense, net of interested capitalized

(1,600)

-

Total other expense

(14,893)

3,352

 

 

 

Income (loss) before taxes

(25,816)

6,154

Income tax provision

945

1,005

 

 

 

Income (loss) from continuing operations

(26,761)

5,149

Income from discontinued operations

6,021

323

Net income (loss)

(20,740)

5,472

 

 

 

Preferred dividends

(40)

(40)

 

 

 

Income (loss) available to common shares

$ (20,780)

$     5,432

 

 

 

Basic income/(loss) available to common shares per share:

 

 

From continuing operations

$      (1.40)

$       0.33

From discontinued operations

0.31

0.02

 

$      (1.09)

$       0.35

Diluted income (loss) available to common shares per share:

 

 

From continuing operations

$      (1.40)

$       0.31

From discontinued operations

0.31

0.02

 

$      (1.09)

$       0.33

Weighted average shares outstanding:

Basic

19,170

15,637

Diluted

19,170

18,677

 


 

Toreador Q3 2007 Financial Resultse, Nov. 9, 2007

Page 7 of 7

 

 

TOREADOR RESOURCES CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(Unaudited)

 

 

Nine Months Ended

September 30,

 

2007

2006

 

 

 

Oil and natural gas sales

$   29,183

$   25,425

 

 

 

Operating costs and expenses:

Lease operating

8,337

6,191

Exploration expense

9,544

2,001

Depreciation, depletion and amortization

13,525

3,946

Dry hole expense

21,357

-

General and administrative

14,248

6,896

Loss on oil and gas derivative contracts

813

-

Gain on sale of properties and other assets

(3,584)

(438)

Total operating costs and expenses

64,240

18,596

 

 

 

Operating income (loss)

(35,057)

6,829

 

 

 

Other income (expense):

Equity in earnings of unconsolidated investments

22

263

Foreign currency exchange gain (loss)

(29,347)

1,863

Interest and other income

865

1,973

Interest expense, net of interested capitalized

(2,510)

(162)

Total other income (expense)

(30,970)

3,937

 

 

 

Income (loss) before taxes

(66,027)

10,766

Income tax provision (benefit)

(4,534)

2,090

 

 

 

Income (loss) from continuing operations

(61,493)

8,676

Income from discontinued operations

6,931

1,517

Net income (loss)

(54,562)

10,193

 

 

 

Preferred dividends

(122)

(122)

 

 

 

Income (loss) available to common shares

$ (54,684)

$   10,071

 

 

 

Basic income/(loss) available to common shares per share:

 

 

From continuing operations

$      (3.41)

$       0.55

From discontinued operations

0.38

0.10

 

$      (3.03)

$       0.65

Diluted income (loss) available to common shares per share

 

 

From continuing operations

$      (3.41)

$       0.54

From discontinued operations

0.38

0.09

 

$      (3.03)

$       0.63

Weighted average shares outstanding:

Basic

18,092

15,488

Diluted

18,092

17,316

 

 

 

 

 

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