Canadian energy explorer,
Talisman Energy Inc.
), reported weak second-quarter 2013 results due to decreased
production along with lower oil and liquids price realizations.
The company announced a loss per share from continuing operations
(excluding non-operating items) of 3 cents against the Zacks
Consensus Estimate of 4 cents. In the year-ago quarter, Talisman
reported earnings of 7 cents per share.
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Quarterly total revenue of $1,185.0 million deceased 34.2% from
$1,800 .0 million in the second quarter of 2012. Revenues also
missed the Zacks Consensus Estimate of $1,422.0 million.
The quarter's total production of 361 thousand barrels of oil
equivalent per day (MBOE/d) was down 17.0% from the year-ago
level, mainly due to North Sea area's turnaround and downtime
activities along with Algeria's constrained output.
Oil & liquids production was down 34.6% at 98,959 barrels per
day (Bbl/d). Volumes were affected by significantly lower
production in the North Sea.
Talisman's natural gas volumes were down 14.4% at 1,369 million
cubic feet per day (MMcf/d), mainly due to the decrease in
production in North America and North Sea.
During the quarter, Talisman's realized commodity prices dropped
slightly by 0.9% from the year-ago quarter to $52.68 per barrel
of oil equivalent (BOE) mainly on account of lower oil and
liquids realizations from North America and Southeast Asia. This
was partially offset by higher gas prices in North America and
Overall, natural gas prices increased 29.7% year over year to
$6.12 per Mcf, while oil and liquids realizations averaged $89.51
per barrel, down 7.6% from the year-ago level.
Cash Flow and Capital Expenditure
Cash flow from continuing operations totaled $526.0 million, down
34.5% year over year. Talisman spent $843.0 million on
exploration and development activities.
As of Jun 30, 2013, Talisman had cash and cash equivalents of
approximately $270.0 million and long-term debt of $4,923.0
million (including current portion), with a
debt-to-capitalization ratio of 33.6%.
Talisman expects its 2013 full-year production to be 375 MBOE/d,
which is at the lower end of the previously projected range of
375-395 MBOE/d. Oil & liquids production is anticipated to be
roughly 132,000 Bbl/d while natural gas volumes will be 1,457
MMcf/d for 2013.
Talisman currently carries a Zacks Rank #3 (Hold), which implies
that it is expected to perform in line with the broader U.S.
equity market over the next one to three months.
Meanwhile, one can look at exploration and production firms like
ARC Resources Ltd.
Canadian Oil Sands Limited
) which offer value. Enerplus carries a Zacks Rank #1 (Strong
Buy) while ARC Resources and Canadian Oil Sands have a Zacks Rank