Last week, Bonanza Creek Energy Inc. (BCEI) released its third quarter earnings report, which missed consensus estimates for the second straight quarter. Earnings per share came in at -$0.35 compared to Street estimates of -$0.27. This is up slightly from 2Q16, when the company reported EPS of -$0.40, and represents the company's best EPS showing this year. (See also: Bonanza Creek Energy’s Fierce Headwinds.)
On the revenue side, the company reported $49.3 million against analyst estimates of $52.3 million, down 10% from 2Q16 and down 32% over last year at this time. Bonanza Creek reported production of 21,000 barrels of oil equivalent per day (BOE/D), down 10% from the second quarter and 28% from 3Q15. However, production was up 5% over mid-point guidance.
Cost Structure Comes Down
Lease operating expense (LOE) was down on a per-unit basis to $5.13 per BOE in the third quarter over the same period last year, when it reached $6.44/BOE. The company managed to achieve a 20% decrease in LOE year over year even with declining production.
On the other hand, general and administrative (G&A) expense increased substantially over 2Q16 and the same period last year. For 3Q16, G&A was $9.68/BOE; in the second quarter, it was $5.07, and last year at this time, it was $6.69. The company attributes the increase to advisor fees related to financing alternatives for $5.9 million in debt.
New CAPEX and Production Guidance
Due to Bonanza Creek’s increased production this quarter, the company revised its total year guidance from 17,700 to 18,300 BOE/D to 21,500 to 21,700 BOE/D. In addition, the total year CAPEX guidance increased to $25 million to $27 million for the year. Year-to-date, Bonanza Creek reported $18.5 million in upstream CAPEX. (See also: Upstream and Downstream Oil and Gas Production.)
BCEI closed at $0.94, up 0.62% on a volume of 985,000 shares. The stock is down 87.6% for the year.