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Be the first with the news that moves the market- Crescent Point Energy (TSX:CPG) has reported a net loss of C$2.32 billion in its first quarter, due to a recent steep drop in the price of oil
- The net loss was the result of a $3.56 billion non-cash impairment charge based on the change in the value of oil
- The company was quick to point out that these losses can be fully or partially reversed if the price of oil improves
- Ignoring impairments, the company generated $48.7 million in adjusted net earnings, down from $158.3 million in 2019’s same quarter
- Crescent Point Energy (CPG) is down 4.21 per cent, with shares trading for $1.82 and a market cap of $960.5 million
Crescent Point Energy (TSX:CPG) has reported a net loss of C$2.32 billion in its first quarter, due to the recent oil price crash.
The net loss was the result of a $3.56 billion non-cash impairment charge based on a change in the value of oil.
The company was quick to point out that these losses can be fully or partially reversed if the price of oil improves. It also noted that the non-cash loss does not impact its credit capacity or its adjusted cash flows.
In the first quarter of 2019 the company generated a net profit of $1.9 million.
Ignoring impairments, the company generated $48.7 million in adjusted net earnings. This figure is still considerably lower than the $158.3 million in adjusted net earnings that the company reported in 2019’s same quarter.
Due to the oil price drop the company shut-in production at a number of its operations and re-evaluated its full-year production guidance. The first quarter remains on track to meet the new full-year target of 110,000 to 114,000 barrels of oil per day.
This target assumes the company’s shut-in operations remain for the remainder of the year. However, Crescent Point has stated that it will consider restarting production as the market improves.
President and CEO of Crescent Point, Craig Bryksa, said the company has been working to reposition itself over the past two years, which will help it weather a poor oil market.
“Our efforts have centred on enhancing our long-term sustainability, including strengthening our balance sheet and lowering our cost structure.
“During this period of uncertainty and volatility, we have and will continue to prioritize the safety of our employees and the communities in which we operate, and continue to protect our financial flexibility while remaining focused on returns, capital discipline and realizing additional cost savings,” he said.
Crescent Point Energy (CPG) is down 4.21 per cent, with shares trading for $1.82 at 12:56pm EDT.
