Sundance Energy (ASX:SEA) released its Annual General Meeting report on Thursday, which detailed improved production targets and debt refinancing. The company has closed the previously announced debt financing with US-based Morgan Stanley Bank and Morgan Stanley Capital Group. The company closed a revolving credit facility and second lien term loan deal on 14 May. After closing its previous credit facilities, the company can draw from a new $150m credit line. The deal also included a $300m senior secured revolving borrowing base with $25m drawn at closing and a $175m senior term loan facility with $125m drawn at closing.
The company now estimates its total liquidity position to be approximately $63m at the end of the March quarter. Sundance reported record production averages in 2014. The company produced 6,635 million barrels of oil equivalent per day (boepd) last year, an increase of 120 per cent compared to the previous corresponding period. In December, Sundance recorded 9,434 boepd for the month, which is almost double compared to the previous corresponding period and beat production guidance levels.
Sundance expects 2015 production to come between 7,850 boepd and 8,500 boepd. However, in the quarter up to 31 March 2015, average daily production totalled 9,581 boepd, significantly above its own production guidance. In addition to increased production, the company saw an increase to earnings before interest, tax, depreciation, amortisation and exploration (EBITDAX). Its adjusted EBITDAX margin was raised 77 per cent upon top-tier cost structure reductions. Shares of SEA have fallen .3c, or .51 per cent, at 58.7c per share around 1:00pm on Thursday. SEA has fallen 44.62 per cent in the last 12 months but has risen 11.81 per cent so far this year.
Author: Simon Herrmann
May 28, 2015
Simon is a financial analyst at independent research firm Wise-owl specialised in small-mid cap growth opportunities and ethical investment opportunities. Simon's aim is to disrupt the cliché approach to investment decision making as he believes that socially and environmentally responsible behaviour is a necessity to long-term wealth creation. Simon has a deep fundamental understanding of the global financial landscape and has compiled 300+ research reports, valuations and corporate appraisals. Simon is commonly featured in major media outlets and his research is published weekly in The Australian.