Q2 2020 TransAtlantic Petroleum Ltd Earnings Call

Ladies and gentlemen, todays conference is scheduled to begin shortly please continue to standby. Thank you for your patience.

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Please be advised of today's conference is being recorded if you're acquiring the assistance during the conference. Please press Star then zero.

I'd like to hand, the conference over to your speaker today Miss out with a bailout daily General Counsel. Thank you. Please go ahead.

Good morning.

Welcome to transatlantic Petroleum second quarter 2020 earnings conference call.

The call today, we have Malone Mitchell, our chairman and Chief Executive Officer, Michael Hill, Our Chief Accounting Officer and myself.

During today's call, we will make certain forward looking statements, which include statements regarding our beliefs goals expectations for cash.

Projection and future performance and the assumptions underlying such statements.

Please note that there are a number of factors that may cause actual results could materially differ from our forward looking statements, including the factors identified and discuss in our earnings press release, which we issued after the close of business yesterday and in our FCC filings.

Please recognize that except as required by law, we undertake no duty to update any forward looking statement and you should not place any undue reliance on such statements.

Now, we'll turn over the call to our chairman and Chief Executive Officer, One Mitchell.

Thank you Doug good morning, ladies and gentlemen, thank you for calling in to the transatlantic petroleum second quarter 2020 conference call.

As with most other all companies the second quarter of 2020 resulted in the poorest financial results in several years.

Our Chief Financial Officer, Michael He'll review those results shortly.

Transatlantic petroleum remains financially and operationally focused on maintaining its existing producing wells and moderating the production decline from those wells.

The company does not have the cash flow or cash balances after operations and debt service to drill additional new wells this year, and therefore expects production to continue to decline.

The company does not expect to have the cash flow to pay its preferred dividends in cash and therefore expects to continue to issue common stock as dividends subject to board review and approval.

The board of Directors recently approved and entered into a plan of merger with an entity comprised of all of the preferred shareholders of the company.

This is consistent with terms contained within public filings with a letter of intent filed on July the second 2020.

Likewise, the board recently approved and entered into a loan agreement to provide funds to maintain the operations and senior debt schervish through the effective date of the transaction.

Since 2015, the company has been unable to secure adequate and acceptable credit to conduct its business utilizing only its own assets as collateral.

Both the plan of merger and alone are subject to significant conditions and processes.

The company is preparing a proxy form which should expects to complete approximately mopping up.

Further information is available in the company's filings and will be supplemented through the proxy for.

These continued to be found on the Trans Atlantic company website by going to the Investor section.

Then to the financial information tab.

And then to the FCC filings.

Now I will turn the call over to Mark will feel to review the financials.

Thanks, a lot and good morning, everyone.

As disclosed in our press release, along with our 10-Q filed yesterday.

Right now they are second quarter 2020 operating results.

We reported a net loss of 7.7 million or 12 cents per share.

During the second quarter of 2020 compared to a net loss of 24 million or 38 cents per share for the first quarter of 2020.

Net loss of 9000.

Brazil zero cents per share for the second quarter 2019.

Our 2022nd quarter revenues were 6.5 million was down 22% from the first quarter and down 62% year over year.

The decrease in our second quarter revenues as compared to the first quarter was driven by 13% decrease in our sales volumes and 11% decrease in our average realized price per BLE recede.

The decrease in revenues from the second quarter 2019 was driven by 50% decrease and our average realized price per BOE you received.

24% decrease in sales volumes.

Our second quarter DNA expenses were 2.4 million. This was flat from the first quarter of 2020.

Down 11% from a year ago.

The decrease in DNA from the second quarter of 2019 was due primarily to the decrease in personnel expenses.

As well as travel in office expenses compared to the same period a year ago.

Our second quarter production expenses were 2.4 million was down 32% from the first quarter.

Down 12% from a year ago.

The decrease in production expenses in the second quarter compared to the first quarter was primarily due to a decrease in contract labor personnel expenses.

Looking at repairs and maintenance and a decrease in utilities and diesel fuel fuel consumption.

Our second quarter, adjusted EBITDAX was 0.8 million compared to 8 million in the first quarter of 2020, and 10.7 million in the second quarter of 2019.

The decrease in adjusted EBITDAX from the first quarter was primary due to a decrease I realize derivative settlements, which decreased 6.6 million.

The decrease in revenues of 1.9 million.

This is partially offset by decrease in production expenses 1.1 million and a decrease in transportation expense a 0.2 million.

The decrease is adjusted EBITDAX from the second quarter 2019 was primary due to a decrease in revenues of 10.7 million.

This was partially offset by decrease in production expenses, a zero point Threemillion. The decrease in DNA expenses to your point 3 million and a decrease in transportation expenses as your point 2 million.

[noise] during the second quarter working capital decreased to 1.0 million at June Thirtyth from 3.2 million at March 31st.

The decrease in working capital was primary due to decrease in cash of 4.3 million.

And the increase in our derivative liability of 3.2 million and an increase in current debt than 0.6 million.

This was partially offset by an increase our notes receivable of 3.5 million and a decrease in April and accrued liabilities of 2.2 million.

Our capital expenditures were 0.69 during the second quarter 2020, that's compared to 2.9 million in the first quarter and 6.2 million in a second quarter 2019.

We expect our Catholics ventures for remainder of 2020 to range between one and one and a half million. Howard This is subject to change at the discretion the board.

I'll now hand, the call back over to Malone.

Thank you Michael This concludes our prepared remarks for the second quarter of 2020 financials on operations and we wish you a very good balance of the week good day.

Ladies and gentlemen, thank you for your participation on today's conference. This does conclude your program you may now disconnect.

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