Yoho Resources Inc.
TSX VENTURE : YO

Yoho Resources Inc.

August 19, 2009 09:00 ET

Yoho Resources Inc. Announces Financial and Operating Results for Third Fiscal Quarter and Continues Production Growth with 31% Increase from Q3 2008

CALGARY, ALBERTA--(Marketwire - Aug. 19, 2009) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Yoho Resources Inc. ("Yoho" or the "Company") (TSX VENTURE:YO) filed today the interim unaudited consolidated financial statements for the nine months ended June 30, 2009 and related Management's Discussion and Analysis on www.sedar.com.

Highlights

- Increased production 31% to 2,682 boe per day for the three months ended June 30, 2009 from 2,041 boe per day for the three months ended June 30 2008. Production for Q3 2009 increased 11% from 2,408 boe per day during Q2 2009.

- Funds from operations for the third quarter of fiscal 2009 were $2.5 million compared to $7.2 million during the third quarter of fiscal 2008. On a per share basis, funds from operations for the three months ended June 30, 2009 were $0.12 per share diluted compared to $0.38 per share diluted for the same period last year.

- Maintained a strong balance sheet with $24.1 million drawn at June 30, 2009 on a bank credit facility of $32 million.

- Effective April 1, 2009, closed a property acquisition in the Howard area of Alberta for $1.8 million which added production of approximately 100 boe per day and included undeveloped land and 2D and 3D seismic.

- Improved overall cash costs (operating, processing, G&A and interest) of $10.92 per boe for the third fiscal quarter of 2009 compared to $13.49 per boe for the third fiscal quarter of 2008.

Operations

During the nine months ended June 30, 2009, Yoho has participated in drilling 15 (9.4 net) wells resulting in 13 (8.0 net) gas wells and 2 (1.4 net) wells which were dry and subsequently abandoned. Total capital expenditures for the nine months ended June 30, 2009 were $14.5 million, including the $1.8 million property acquisition. The successful drilling activities and the property acquisition have increased Yoho's production 31% for the three months ended June 30, 2009 to average 2,682 boe per day (86% natural gas), from 2,041 boe per day for the three months ended June 30, 2008. Yoho has continued to acquire land in selective areas at crown sales, with 14 net sections added during fiscal Q3 and an additional 5 net sections added to date during fiscal Q4. The Company's total undeveloped land is currently 155,000 net acres. Yoho's estimate of fiscal Q4 production is 2,400 boe per day, with production currently impacted by plant turnarounds in various areas and the rupture of a third party major trunk line in northern Alberta. Repairs to the pipeline are currently underway and production is anticipated to be restored in early September 2009.

Financial

Funds from operations for the third quarter of fiscal 2009 of $2.5 million compared to $7.2 million during the third quarter of fiscal 2008, with the 31% increase in production offset by a 69% decrease in natural gas prices received. During the quarter ended June 30, 2009, the Company received $3.28 per mcf for natural gas compared to $10.63 per mcf during the quarter ended June 30, 2008. On a per share basis, funds from operations for three months ended June 30, 2009 was $0.12 per share diluted compared to $0.38 per share diluted for the same period last year. Yoho continued to improve overall costs, with cash costs (operating, processing, G&A and interest) of $10.92 per boe for the third fiscal quarter of 2009 compared to $13.49 per boe for the third fiscal quarter of 2008.

Outlook

With reduced natural gas prices, Yoho's capital program for fiscal 2009 will total between $15 and $16 million. During the fourth fiscal quarter, Yoho will continue to focus on land acquisition and the evaluation of both property and corporate acquisitions. The Company is preparing for the upcoming winter drilling season and is reviewing capital allocation by province in light of recent royalty announcements.

Yoho Resources Inc. is a Calgary based junior oil and natural gas company with operations focusing in the northwest Peace River Arch of Alberta and northeast British Columbia. The common shares of Yoho are listed on the TSX Venture Exchange under the symbol "YO".

This press release shall not constitute an offer to sell or a solicitation of an offer to buy the securities in any jurisdiction. The common shares of Yoho will not be and have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States, or to a U.S. person, absent registration or applicable exemption therefrom.

CAUTIONARY STATEMENTS

Certain statements regarding Yoho Resources Inc. including management's assessments of future plans and operations, may constitute forward-looking statements under applicable securities laws and necessarily involve known and unknown risks and uncertainties, most of which are beyond Yoho's control. These risks may cause actual financial and operating results, performance, levels of activity and achievements to differ materially from those expressed in, or implied by, such forward-looking statements.

Such factors include, but are not limited to: the impact of general economic conditions in Canada and the United States; industry conditions including changes in laws and regulations including adoption of new environmental laws and regulations, and changes in how they are interpreted and enforced; competition; the lack of availability of qualified personnel; fluctuations in commodity prices; the results of exploration and development drilling and related activities; imprecision in reserve estimates; the production and growth potential of Yoho's various assets; fluctuations in foreign exchange or interest rates; the ability to access sufficient capital from internal and external sources; and obtaining required approvals of regulatory authorities.

This forward-looking information represents our views as of the date of this document and such information should not be relied upon as representing our views as of any date subsequent to the date of this document. We have attempted to identify important factors that could cause actual results, performance or achievements to vary from those current expectations or estimates expressed or implied by the forward-looking information. However, there may be other factors that cause results, performance or achievements not to be as expected or estimated and that could cause actual results, performance or achievements to differ materially from current expectations. There can be no assurance that forward-looking information will prove to be accurate, as results and future events could differ materially from those expected or estimated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. While we anticipate that subsequent events and developments may cause our views to change, we do not have an intention to update this forward-looking information, except as required by applicable securities laws.

BOE PRESENTATION

In conformity with National Instrument 51-101, Standards for Disclosure of Oil and Gas Activities ("NI 51-101"), natural gas volumes have been converted to barrels of oil equivalent ("boe") using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil. This ratio is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Readers are cautioned that the term "boe" may be misleading, particularly if used in isolation.

NON-GAAP FINANCIAL MEASURES

The terms "funds from operations", "funds from operations per share", and "cash costs" do not have any standardized meaning prescribed by Canadian GAAP. Management uses funds from operations and funds from operations per share to analyze operating performance and leverage and considers funds from operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investments and to repay debt. Funds from operations should not be considered an alternative to, or more meaningful than cash flow from operating activities as determined in accordance with Canadian GAAP as an indicator of the Company's performance. Therefore references to funds from operations or funds from operations per share (basic and diluted) may not be comparable with the calculation of similar measures for other entities. Yoho calculates funds from operations per share using the same method used in the determination of net income per share.

Yoho also uses "operating netbacks", "cash costs" and per boe metrics as key performance indicators. These terms do not have a standardized meaning prescribed by Canadian GAAP and therefore may not be comparable with the calculation of similar measures by other companies. Management considers netbacks an important measure as it demonstrates its profitability relative to current commodity prices. The Company uses this measure to help evaluate its performance.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Yoho Resources Inc.
    Wendy S. Woolsey
    Vice President, Finance and CFO
    (403) 537-1771
    Website: www.yohoresources.ca