Vancouver, British Columbia, August 18, 2022 – Hemisphere Energy Corporation ("Hemisphere" or the "Company") provides its financial and operating results for the second quarter ended June 30, 2022.
During the second quarter of 2022, Hemisphere achieved record adjusted funds flow from operations (AFF)1 of $14 million and lowered net debt to $3.7 million. Hemisphere was also active in the field with five new wells drilled in the Atlee Buffalo area, which were brought onstream throughout July. The Company continues to optimize both production and injection operations at its polymer and water flood pools in the area and anticipates further production growth through the year. A second drilling program will take place in September with up to four additional wells planned.
With significant free funds flow1 of over $8 million in the quarter, Hemisphere’s board of directors has approved a quarterly dividend of $0.025 per share, to be paid on September 7, 2022 to shareholders of record as of the close of business on August 31, 2022. The dividend is designated as an eligible dividend for income tax purposes.
Q2 2022 Highlights
- Produced a record quarterly average of 2,883 boe/d, a 61% increase over the second quarter of 2021.
- Attained record quarterly revenue of $30.6 million, a 203% increase over the second quarter of 2021.
- Delivered an operating field netback1 of $71.25/boe, 82% higher than in the second quarter of 2021.
- Realized record adjusted funds flow from operations (AFF)1 of $14.0 million ($0.14 per diluted share), a 232% increase over the comparable period in 2021.
- Achieved free funds flow1 of $8.2 million, ($0.08 per diluted share), representing a 250% increase over the comparable period in 2021.
- Lowered net debt1 at the end of the quarter to $3.7 million from $18.5 million at the end of June 2021, representing an 80% reduction year-over-year.
- Exited the quarter with a net debt to annualized AFF ratio1 of 0.07.
- Paid Hemisphere’s inaugural quarterly variable dividend of $0.025 per share.
- Acquired 656,500 Hemisphere shares as part of the corporate NCIB at an average price of $1.62.
Since the second quarter of 2021, Hemisphere has organically grown production by approximately 75% to an average of 3,150 boe/d in July 2022 (99% heavy crude oil). Over the same period, Hemisphere reduced its net debt to annualized AFF ratio1 to less than 0.1. In June, Hemisphere commenced a variable dividend program targeting approximately 30% of annual free cash flow to be paid to shareholders quarterly. Additionally, over a million total shares have been purchased under Hemisphere’s Normal Course Issuer Bid (NCIB) to date in 2022.