OilVoice - Toreador Announces Fourth Quarter and Full Year 2009 Results

Toreador Announces Fourth Quarter and Full Year 2009 Results

Monday, March 15, 2010

• Total revenue for 2009 was $19.2 million; total costs and expenses were $35.4 million.
• Loss from discontinued operations was $10.1 million; net loss available to common shares was $25.4 million.
• Production for year was 328 mboe.
• Capital expenditures for 2009 totaled $7.1 million.
• Year-end cash and cash equivalents balance was $8.7 million.
• Repurchase of $25.7 million of our 5.00% Convertible Senior Notes for $21.3 million.
• A current ratio of 0.34 to 1; debt to equity ratio of 8.90 to 1.
• Process to identify a partner for unconventional assets progressing.

Toreador Resources Corporation today announced its unaudited fourth quarter and full year 2009 financial results.

Craig McKenzie, President and CEO of Toreador, said:
"Toreador's fourth quarter and full-year financial results reflect a turn-around year for the company. A year ago we undertook a set of governance, financial, and operational initiatives to improve performance for the benefit of our shareholders. Today I am pleased to report that we have a much-improved balance sheet where our debt has been reduced to a sustainable level, a streamlined operating and cost structure, and an asset portfolio that is singularly focused on oil exploration and production in France. The French assets include a stable, low-decline conventional base, which had a 27% increase in 1P reserves after deducting 2009 production and has further growth potential that we intend to pursue in 2010. We believe the unconventional shale oil potential in the Paris Basin is a growth opportunity for the company. With our acreage holding of 750,000 acres, applications for additional acreage pending, and a partnering process that is progressing, we believe we are on track to drill in the second half of this year to commence the proof of concept phase for this resource."

Reserves
As of December 31, 2009, Toreador's proved reserves were 5.8 mmbbl compared to 4.9 mmbbl for 2008. All of the company's proved reserves are located in the Paris Basin, France, and the Neocomian Complex accounted for 93.31% of proved reserves at December 31, 2009. This approximately 18.36% increase can be accounted for by improved performance of the Neocomian Complex, which led to lower assumed decline. Because of the low decline and maturity of the Neocomian Complex, changes in the price used to calculate reserves from year to year do not have a significant effect on reserves estimates.

2009 Production

Oil (MBbls):
France: 80 ('08:87)
Total 80 ('08:87)

Strategic Partner Process
In November 2009, the company's Board of Directors retained RBC Capital Markets to assist the Board's Strategic Committee in the review of various strategic alternatives. The approach Toreador are principally focused on is identifying a potential partner to assist them, through a farm-out agreement or other means, in exploiting their shale oil acreage in the Paris Basin. The Toreador's current priority is to execute a proof of concept program by drilling, completing and testing three pilot wells in the second half of 2010, subject to approval of drilling by the French government, for which the company intend to submit an application by the end of March 2010. Assuming Toreador are able to reach agreement with a partner, the company expect that this process could be completed during the first half of 2010, with development intended to begin thereafter.

4th Quarter
Fourth quarter 2009 revenues increased to $6.1 million from $4.7 million in the same period last year, primarily due to a 34% increase in the average price received for oil sales, which offset a 8% decline in production compared to same period last year.

Toreador recorded an operating loss in the fourth quarter of 2009 of $5 million, compared to an operating loss of $3.1 million in the same period last year. Non-cash expenses in the fourth quarter of 2009 include depreciation, depletion and amortization of $1.3 million and $0.8 million of stock compensation expense, which is included in general and administrative expense.

Lease operating expense in the three months ended December 31, 2009 was $3.4 million, and general and administrative expense net of stock compensation expense was approximately $5 million.

For the three months ended December 31, 2009, the company reported a loss available to common shares of $5.0 million, or $0.25 per diluted share, compared to a loss available to common shares of $38.5 million in the fourth quarter of 2008, or $1.93 per diluted share.

Diluted weighted average shares outstanding in the fourth quarter of 2009 were 21.0 million, compared to 20.0 million diluted weighted average shares outstanding in the fourth quarter of 2008.

Full Year
For full year 2009, revenues from continuing operations (France) decreased to $19.2 million from $34.2 million for the same period last year primarily due to the global decrease in oil prices and decreased production. Cost and expenses were $35.4 million compared to $32.6 million in 2008.

An operating loss of $16.2 million was recorded in 2009 compared to a $1.6 million operating income in 2008.

Lease operating expenses for the twelve months ended December 31, 2009 were $8.4 million compared to $9.3 million for 2008, a decrease primarily due to a decrease in production.

General and administrative expense was $20.4 million, of which $3.6 million was stock compensation, $0.9 million was severance payments to former officers, $0.5 million was legal and consulting expenses due to the sale of our subsidiaries in Turkey and Hungary and $4.0 million of costs associated with the Dallas office/ relocation of our headquarters to Paris, France.

As a result, general and administrative expense before stock compensation, cost incurred due to resignation of former officers, costs associated with subsidiary sales and costs associated with the Dallas office/relocation of headquarters, was $11.3 million for the twelve months ended December 31, 2009, compared with $9.8 million for the comparable period of 2008.

Non-cash operating expenses recorded in 2009 included depreciation, depletion and amortization of $5.8 million and stock compensation of $3.6 million.

For the year ended December 31, 2009, the Company recorded a gain on the early extinguishment of debt of $3.3 million, which was due to the repurchase of $25.7 million principal amount of our 5.00% convertible senior notes on the open market and through privately negotiated transactions for $21.3 million plus accrued interest and prepaid loan fees. In the comparable period of 2008, the Company recorded gain on the early extinguishment of debt of $0.5 million due to the repurchase of $6 million principal amount of our 5.00% convertible senior notes on the open market and through privately negotiated transactions for $5.3 million plus accrued interest and prepaid loan fees.

Discontinued operations recorded a loss of $10.1 million compared to $101.6 million in 2008.

Loss available to common shares decreased to $25.4 million, or $1.22 per diluted share, in 2009 from a loss available to common shares of $108.6 million, or $5.48 per diluted share for 2008.