UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
REPORT
OF FOREIGN ISSUER PURSUANT TO RULE 13a-16 AND 15d-16
UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the
Period: August 16,
2010 File
No.
001-33503
DEJOUR ENTERPRISES
LTD.
(Name of
Registrant)
598-999 Canada Place,
Vancouver, British Columbia, Canada, V6C 3E1
(Address
of principal executive offices)
Indicate
by check mark whether the Registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.
Indicate
by check mark whether the Registrant by furnishing the information contained in
this Form is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Dejour
Announces $559K Operating Cash Flow for Q2 2010
Quarterly
Production Increased by 89%
Vancouver
, British
Columbia
,
August 16,
2010
--
Dejour
Enter
prises Ltd.
(
NYSE-AMEX: DEJ / TSX: DEJ)
(“Dejour”)
,
a
n independent
oil
and natural gas company operating
multiple exploration and production projects in Northeastern British Columbia
and
Western
Colorado
,
today announced the
release of its
financial
results for the
second
quarter
period ended
June 30, 2010
.
During the second quarter, Dejour placed
two new wells into production at the company operated Drake/Woodrush Field. The
success of the first quarter drilling program at Drake/Woodrush
was an important step towards meeting
Dejour’s growth targets for 2010. Key to the Company’s 2010
strategy was expected improvement in the operating performance in the 2nd
quarter
(
as referred to in the Company’s
May 13, 2010 news
release)
. In Q2, the
production was almost double the production for the
1st quarter. This substantial production
improvement provided the Company with the generation of positive operating cash
flow for the quarter. In addition, according to the recently updated reserve
evaluation report from an independent consultant, Dejour raised the net present
value of Proved and Probable Reserves at Drake/Woodrush by 150% to $17 million
at June 30, 2010. In view of its strong production growth and significant
increase in reserve value at Drake/Woodrush, the Company will continue its focus
on exploiting development opportunities in these properties.
Q2 2010
Key
a
chievements
|
·
|
Successfully
brought two new wells into production, generating positive operating cash
flow of $559,000.
|
|
·
|
Increased
Proved and Probable Producing Reserves at Drake/Woodrush to 534,000
Barrels of Oil Equivalent (58% oil), with a Present Value 10% (PV 10) at
$15.7 million, an increase of 140% from December 31, 2009 PV 10 value of
$6.5 million.
|
|
·
|
Increased
net production to 599 BOE/D (58% oil) in Q2 2010, an 89% increase over Q1
2010.
|
|
·
|
Increased
operating netback to $1.5 million in Q2 2010, a 416% improvement over Q1
2010.
|
|
·
|
Increased
EBTIDA by $1,575,000 delivering a positive EBITDA of $658,000, and yielded
a positive Adjusted EBITDA of $808,000 in
Q2.
|
Key corporate objectives for
the remainder of 2010
|
·
|
Generate
operating profits by 2010
Q4;
|
|
·
|
Increase oil production
and
reserves with the
drilling of additional wells, in Q3 2010, at the Drake/Woodrush
Field;
|
|
·
|
Confirm the waterflood potential
with Q3 drilling and begin project implementation in
Q4;
|
|
·
|
Complete the
permitting/
engineering
for th
e Phase 1 drilling at Gibson
Gulch; and
|
|
·
|
Procure
a
commitment on a
competitive
non-equity project
funding package for Phase 1
drilling at Gibson Gulch
.
|
Summary of Selected
Financial Highlights
|
|
|
Three
months ended June 30,
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
$
|
|
|
$
|
|
Revenue
|
Note
(1)
|
|
|
2,768,000
|
|
|
|
1,682,000
|
|
Net
loss
|
Note
(2)
|
|
|
(344,000
|
)
|
|
|
(781,000
|
)
|
Net
loss per share
|
Note
(3)
|
|
|
(0.003
|
)
|
|
|
(0.011
|
)
|
Operating
cash flow
(1)
|
Note
(4)
|
|
|
559,000
|
|
|
|
(243,000
|
)
|
Operating
netback
(1)
|
Note
(5)
|
|
|
1,464,000
|
|
|
|
830,000
|
|
EBITDA
(1)
|
Note
(6)
|
|
|
658,000
|
|
|
|
490,000
|
|
Adjusted
EBITDA
(1)
|
Note
(6)
|
|
|
808,000
|
|
|
|
560,000
|
|
|
(1)
|
Operating
cash flow, Operating netback, EBITDA and Adjusted EBITDA are non-GAAP
measures and are defined in details in the “Non-GAAP Measures”
below.
|
Notes:
|
(1)
|
Revenue
for Q2 2010 increased to $2,768,000 from $1,682,000 for Q2 2009. The
increase was mainly attributable to the two new wells commenced production
in May 2010.
|
|
(2)
|
Net
loss for Q2 2010 decreased to $344,000 from $781,000 for Q2 2009. The
decrease was due to higher revenues and lower operating and transportation
and depletion expenses, partially offset by higher
royalties.
|
|
(3)
|
Net
loss per share for Q2 2010 was $0.003 compared to $0.011 for Q2 2009. The
decrease was mainly the result of lower net loss for the current
quarter.
|
|
(4)
|
The
Company generated a positive operating cash flow of $559,000 for Q2 2010
compared to a negative operating cash flow of $243,000 for Q2 2009. It was
mainly the result of the two new wells commenced production in May
2010.
|
|
(5)
|
Operating
netback for Q2 2010 increased to $1,464,000 from $830,000 for Q2 2009. The
increase was due to the two new wells commenced production in May
2010.
|
|
(6)
|
EBITDA
for Q2 2010 increased to $658,000 from $490,000 for Q2
2009. Adjusted EBITDA for Q2 2010 increased to $808,000 from
$560,000 for Q2 2009. The increase was mainly attributable to
lower net loss.
|
Summary of Selected
Operational Highlights
DEAL Production and Netback
Summary
|
|
|
Three Months Ended June
30,
|
|
|
|
|
2010
|
|
|
2009
|
|
Production
Volumes:
|
|
|
|
|
|
|
|
Oil
and natural gas liquids
(bbls)
|
|
|
|
31,
753
|
|
|
|
15,
777
|
|
Gas (mcf)
|
|
|
|
136,538
|
|
|
|
207,748
|
|
Total (BOE)
|
Note (1)
|
|
|
54,509
|
|
|
|
50,402
|
|
|
|
|
|
|
|
|
|
|
|
Average Price
Received:
|
|
|
|
|
|
|
|
|
|
Oil
and natural gas liquids
($/bbls)
|
|
|
|
65.79
|
|
|
|
59.43
|
|
Gas ($/mcf)
|
|
|
|
4.29
|
|
|
|
3.88
|
|
Total
($/BOE)
|
|
|
|
49.08
|
|
|
|
34.61
|
|
|
|
|
|
|
|
|
|
|
|
Royalties
($/BOE)
|
Note (2)
|
|
|
10.11
|
|
|
|
(0.45
|
)
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses
($/BOE)
|
Note (3)
|
|
|
12.11
|
|
|
|
18.60
|
|
|
|
|
|
|
|
|
|
|
|
Netbacks
($/BOE)
|
Note (4)
|
|
|
26.87
|
|
|
|
16.45
|
|
Notes:
|
(1)
|
The
increase in production was mainly due to the two new wells commenced
production in May 2010.
|
|
(2)
|
Royalties
of $10.11 per BOE for Q2 2010 were substantially higher than the prior
year’s quarter of $(0.45) per BOE. The increase was consistent with higher
revenues generated. In Q2 2009, the British Columbia government approved a
royalty holiday for the first 72,000 barrels of oil production on one of
the Company’s oil wells. The Company received a royalty credit
of $280,000 from the BC provincial government, resulting in a net royalty
recovery for the quarter. This 72,000 barrels royalty holiday
was used up in 2009 and the Company is subject to regular royalty rates in
2010.
|
|
(3)
|
Operating
and transportation expenses for Q2 2010 decreased to $12.11 per BOE
compared to $18.60 per BOE for Q2 2009 despite higher revenues. The
installation of the compressor in January 2010 resulted in minimal
compression costs, which accounted for the reduction in operating and
transportation expenses for the current
quarter.
|
|
(4)
|
Operating
netbacks for the current quarter increased to $26.87 per BOE from $16.45
per BOE for Q2 2009. The increase was mainly due to higher revenues and
lower operating and transportation expenses. This was partially offset by
increased royalties for Q2 2010.
|
Liquidity and Capital
Resources
Cash
Flow
The
Company had cash and cash equivalents of $3 million as of June 30,
2010. In addition to the cash balance, the Company also had accounts
receivable of $1.4 million, most of which was related to June 2010 oil and gas
sales and had been received subsequent to June 30, 2010.
Bank
Loan and Bridge Loan Financing
In March
2010, the Company completely paid off its line of credit with a Canadian
Bank.
Additionally,
in March 2010, the Company acquired a new credit facility for up to $5,000,000.
The first $2,000,000 of the facility was available. The remaining $3 million is
subject to lenders’ engineering review. In June 2010, the Company received
lender’s approval for the availability of an additional $1,500,000 of the
facility. As of June 30, 2010, a total of $3,500,000 of this facility
was utilized.
Dejour is
in discussions with this bridge loan lender to extend and increase this credit
facility.
For more
information and for Dejour’s detailed quarterly report, please visit SEDAR or
the Company’s website at
http://www.dejour.com
.
All amounts above are in CAD$, unless
otherwise noted. 1
US
$ = 1.0
646
CAD$.
Consolidated
Condensed Balance Sheets
|
|
As
at June 30, 2010
|
|
|
As
at December 31, 2009
|
|
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$
|
3,020,000
|
|
|
$
|
2,733,000
|
|
Other
current assets
|
|
|
1,909,000
|
|
|
|
1,280,000
|
|
Equipment
|
|
|
102,000
|
|
|
|
115,000
|
|
Other
non-current assets
|
|
|
43,510,000
|
|
|
|
41,758,000
|
|
Total
assets
|
|
$
|
48,541,000
|
|
|
$
|
45,886,000
|
|
|
|
|
|
|
|
|
|
|
Liabilities
and shareholders’ equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank
line of credit and bridge loan
|
|
$
|
3,500,000
|
|
|
$
|
850,000
|
|
Current
liabilities
|
|
|
3,674,000
|
|
|
|
2,753,000
|
|
Loans
from related parties
|
|
|
2,402,000
|
|
|
|
2,346,000
|
|
Other
long-term liabilities
|
|
|
313,000
|
|
|
|
248,000
|
|
Shareholders’
equity
|
|
|
38,652,000
|
|
|
|
39,689,000
|
|
Total
liabilities and shareholders’ equity
|
|
$
|
48,541,000
|
|
|
$
|
45,886,000
|
|
Consolidated
Statements of Operations
|
|
For
the three months ended June 30,
|
|
|
For
the
six
m
onths
ended June 30,
|
|
|
|
2010
|
|
|
2009
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil
and natural gas revenue
|
|
$
|
2,676,000
|
|
|
$
|
1,682,000
|
|
|
$
|
4,023,000
|
|
|
$
|
4,095,000
|
|
Realized
financial instrument gain (loss)
|
|
|
93,
000
|
|
|
|
-
|
|
|
|
51,000
|
|
|
|
289,000
|
|
|
|
|
2,769,0
00
|
|
|
|
1,682
,000
|
|
|
|
4,074,000
|
|
|
|
4,384,000
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royalties
|
|
|
551
,000
|
|
|
|
(23,
000
|
)
|
|
|
772,000
|
|
|
|
504,000
|
|
Operating
and transportation
|
|
|
660,
000
|
|
|
|
875
,000
|
|
|
|
1,502,000
|
|
|
|
1,873,000
|
|
Amortization,
depletion and accretion
|
|
|
727
,000
|
|
|
|
1,264
,000
|
|
|
|
1,473,000
|
|
|
|
3,975,000
|
|
Interest
expense and finance fee
|
|
|
275
,000
|
|
|
|
306
,000
|
|
|
|
528,000
|
|
|
|
506,000
|
|
General
and administrative
|
|
|
769
,000
|
|
|
|
852
,000
|
|
|
|
1,756,000
|
|
|
|
1,789,000
|
|
Non-cash
stock-based compensation
|
|
|
151
,000
|
|
|
|
107,
000
|
|
|
|
315,000
|
|
|
|
317,000
|
|
|
|
|
3,
133
,000
|
|
|
|
3,381
,000
|
|
|
|
6,346,000
|
|
|
|
8,964,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
before the following and income taxes
|
|
|
(
364,
000
|
)
|
|
|
(
1,699
,000
|
)
|
|
|
(2,272,000
|
)
|
|
|
(4,580,000
|
)
|
Interest
and other income
|
|
|
8,
000
|
|
|
|
105
,000
|
|
|
|
17,000
|
|
|
|
363,000
|
|
Gain
(l
oss
)
on
disposition of investment
|
|
|
-
|
|
|
|
37
,000
|
|
|
|
-
|
|
|
|
(274,000
|
)
|
Equity
loss from Titan
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(142,000
|
)
|
Foreign
exchange
gain
(
loss
)
|
|
|
12,
000
|
|
|
|
477,000
|
|
|
|
(3,000
|
)
|
|
|
325,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
before income taxes
|
|
|
(
344,
000
|
)
|
|
|
(
1,080
,000
|
)
|
|
|
(2,258,000
|
)
|
|
|
(4,308,000
|
)
|
Future
income taxes recovery
|
|
|
-
|
|
|
|
299
,000
|
|
|
|
-
|
|
|
|
1,078,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss for the period
|
|
$
|
(344,000
|
)
|
|
$
|
(781,000
|
)
|
|
$
|
(2,258,000
|
)
|
|
$
|
(3,230,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss per share – basic and diluted
|
|
$
|
0.003
|
|
|
$
|
0.011
|
|
|
$
|
0.023
|
|
|
$
|
0.044
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares outstanding – basic and
diluted
|
|
|
98,698,372
|
|
|
|
7
4,343,228
|
|
|
|
98,220,180
|
|
|
|
74,034,042
|
|
Consolidated
Condensed Statements of Cash Flows
|
|
For
the three months ended March 31,
|
|
|
For
the six months ended June 30,
|
|
|
|
2010
|
|
|
2009
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash,
beginning of period
|
|
$
|
1,336,000
|
|
|
$
|
1,679,000
|
|
|
$
|
2,733,000
|
|
|
$
|
744,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
from (used in) operating activities
|
|
|
55
3
,000
|
|
|
|
(1,148,
000
|
)
|
|
|
-
|
|
|
|
(1,044,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
from (used in) investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase
of equipment
|
|
|
(
2,000
|
)
|
|
|
-
|
|
|
|
(2,000
|
)
|
|
|
(5,000
|
)
|
Proceeds
on disposal of investment
|
|
|
-
|
|
|
|
118,000
|
|
|
|
-
|
|
|
|
2,306,000
|
|
Proceeds
from sales of oil and gas properties
|
|
|
-
|
|
|
|
4,282,000
|
|
|
|
-
|
|
|
|
4,282,000
|
|
Resource
properties expenditures
|
|
|
(883,000
|
)
|
|
|
(
301
,000
|
)
|
|
|
(3,141,000
|
)
|
|
|
(795,000
|
)
|
Total
cash from (used in) investing activities
|
|
|
(
885
,000
|
)
|
|
|
4,099
,000
|
|
|
|
(3,143,000
|
)
|
|
|
5,788,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
from (used) in financing activities
|
|
|
2,016
,000
|
|
|
|
(
3,572,
000
|
)
|
|
|
3,430,000
|
|
|
|
(4,430,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash,
end of period
|
|
$
|
3,020,000
|
|
|
$
|
1,058,000
|
|
|
$
|
3,020,000
|
|
|
$
|
1,058,000
|
|
A
bout
Dejour
Dejour
Enterprises Ltd. is a
n
independent
oil
and natural gas company operating multiple exploration and production projects
in North America’s Piceance / Uinta Basin
(109,000 net acres) and Peace River Arch regions
(20,000 net acres). Dejour’s veteran management team has
consistently been among early identifiers of premium energy assets, repeatedly
timing investments and transactions to realize their value
to shareholders' best advantage.
Dejour,
maintains offices in
Denver
,
USA
,
Calgary
and
Vancouver
,
Canada
.
The company is publicly traded on the New York Stock Exchange Amex
(NYSE
-
Amex: DEJ) and Toronto Stock Exchange (TSX: DEJ).
Non-GAAP
Measures
: This news release contains references to non-GAAP measures as
follows:
Operating
Cash Flow is a non-GAAP measure defined as net cash provided by operating
activities before changes in assets and liabilities.
Operating
Netback is a non-GAAP measure defined as revenues less royalties and operating
and transportation expenses.
EBITDA is
a non-GAAP measure defined as net income (loss) before income tax expense,
interest expense and finance fee, and amortization, depletion and
accretion.
Adjusted
EBITDA excludes certain items that management believes affect the comparability
of operating results. Items excluded generally are non-cash items, one-time
items or items whose timing or amount cannot be reasonably
estimated.
Certain
measures in this document do not have any standardized meaning as prescribed by
Canadian GAAP such as Operating Cash Flow, Operating Netback, EBITDA and
Adjusted EBITDA and therefore are considered non-GAAP measures. These measures
may not be comparable to similar measures presented by other issuers. These
measures have been described and presented in this document in order to provide
shareholders and potential investors with additional information regarding our
liquidity and our ability to generate funds to finance our
operations.
BOE
Presentation
: Barrel of oil equivalent amounts have been calculated using
a conversion rate of six thousand cubic feet of gas to one barrel of
oil. The term “BOE” may be misleading if used in
isolation. A BOE conversion ratio of one barrel of oil to six mcf of
gas is based on an energy equivalency conversion method primarily applicable at
the burner tip and does not represent a value equivalency at the well head.
Total BOEs are calculated by multiplying the daily production by the number of
days in the period.
Statements
Regarding Forward-Looking Information
: This news release contains
statements that may constitute "forward-looking statements" or "forward-looking
information" within the meaning of applicable securities legislation as they
involve the assessment that the reserves and resources described can be
profitably produced in the future, based on certain estimates and assumptions,
these forward-looking statements include but are not limited to, the
availability of funding for future projects, anticipated recovery per well for
Gibson Gulch, the, risks related prospective resource best estimate being
inaccurate or incomplete or based upon errors in assumptions, adverse general
economic conditions, operating hazards, drilling risks, inherent uncertainties
in interpreting engineering and geologic data, fluctuations in oil and gas
prices and prices for drilling and other well services, government regulation
and foreign political risks, as other risks commonly associated with the
exploration and development of oil and gas properties. Additional information on
these and other factors, which could affect Dejour's operations or financial
results, are included in Dejour's reports on file with Canadian and United
States securities regulatory authorities. We assume no obligation to update
forward-looking statements should circumstances or management's estimates or
opinions change unless otherwise required under securities
law.
The
TSX does not accept responsibility for the adequacy or accuracy of this news
release.
|
Ro
bert
L. Hodgkinson, Co-Chairman
&
CEO
|
Investor
Relations –
New
York
|
|
598
– 999 Canada Place,
|
Craig
Allison
|
|
Vancouver,
BC Canada V6C 3E1
|
Phone:
914.882.0960
|
|
Phone: 604.638
.5050 Facsimile:
604.638.5051
|
Email:
callison@dejour.com
|
|
Email:
investor@dejour.com
|
|
|
Dejour Enterprises
Ltd.
|
|
|
(Registrant)
|
|
|
|
|
|
Dated:
August 16, 2010
|
By:
|
/s/ Mathew
Wong
|
|
|
|
Mathew
Wong,
|
|
|
|
Chief
Financial Officer
|
|
DXI Capital (CE) (USOTC:DXIEF)
Historical Stock Chart
From Jun 2024 to Jul 2024
DXI Capital (CE) (USOTC:DXIEF)
Historical Stock Chart
From Jul 2023 to Jul 2024