Activa Resources AG
Activa Resources AG announces strategic update and forecasts for 2013 and 2014
Activa Resources AG / Key word(s): Miscellaneous Corporate News 1st August 2013 Activa Resources AG announces strategic update and forecasts for 2013 and 2014 – On track for strong revenue and EBITDA growth in 2013 – Medium term strategy to generate at least 25 % p.a. as of 2014 – Growth to be financed from cashflow and existing bank facility – Initial positioning in new opportunity with horizontal drilling potential to be announced soon Bad Homburg, 1st August 2013. Activa Resources AG announces details of its forecasts for 2013, 2014 and provides investors with a medium term outlook. As a result of the recently announced results of the latest two wells at OSR-Halliday – Initial Production rates of 4th and 5th horizontal wells were recorded at between 600 and 800 BOED – Activa is now generating significantly higher cash flows and is therefore able to further implement its growth strategy and provide investors with a positive medium term outlook. Current monthly revenues are running at USD 750,000 to 800,000 per month. Therefore Activa is generating annualised revenues of approaching USD 9 to 10 million. Based on assumptions of stable oil and natural gas prices through year-end, group revenues in 2013 are projected to rise a further 15 to 20% y-o-y with stronger EBITDA growth. At OSR-Halliday, one of Activa’s main assets, management expects to drill three new horizontal wells per annum in the coming years and consistently increase the field’s production of oil and natural gas. Based on assumptions of similar drilling results and stable product pricing, management is planning to grow revenues in the coming years by at least 25% p.a. with substantial EBITDA growth. While Activa has focussed predominantly on OSR-Halliday in the last 24 months management is executing its development strategy to grow revenues, earnings and balance risk between projects. With OSR-Halliday as the main growth driver, Activa will not only continue to develop its existing oil projects (Adams Ranch, Gray Waterflood and Halls Bayou) but also add specific oil development plays which a) build on Activa’s experience in horizontal drilling and multi-stage stimulations and b) are scalable with low-cost entry. Activa has budgeted approximately 10 to 20% of it’s capital expenditures for the initial evaluation of these strategic opportunities. Activa has recently positioned itself with a 100% interest in a new play with horizontal drilling development potential. The company will announce details in the near future. The successful development of the above-mentioned projects would accelerate the company’s growth to exceed the stated 25% p.a. projections. The company is currently planning to fully finance its business strategy from free cash flows and the Texas Capital Bank loan facility at 3.75%. Activa Resources AG CEO Leigh A. Hooper adds: ‘The new OSR-Halliday wells represent a milestone in our development – we have now succeeded in de-risking the OSR-Halliday field development plan in addition to proving up additional drilling locations. Our revenues at the 2013 interim stage are likely to be flat y-o-y. Both new wells will fully contribute to production for the first time in July and will lead to a materially stronger second half. With current monthly revenues of approximately USD 750,000 to 800,000 our US subsidiary is now generating EBITDA exceeding USD 400,000 per month. We are now in a stronger position to execute our growth strategy.’ Management Board
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