ALVOF - Alvopetro Energy (ALVOF) - A strong quarter as higher prices take effect

First quarter results reflect higher prices. Revenues in the 2022 first quarter were $14.0m versus $6.9m and our $13.4m projection. Higher revenues reflect a 15% increase in production and a 48% increase in prices ($10.03/mcf). As a result of higher prices, operating netbacks rose to $53.94/boe from $28.52/boe. This is one of the best netbacks in the industry. Cash flow is soaring. Funds from operations rose to $10.9m versus $4.8m. The company has been active with its cash flow increasing its capital expenditures, paying down debt, and raising the dividend. Working capital less debt switched over to a positive position a few quarters ago and is now $7.3 million. With debt levels soon to be eliminated, the stakeholder focus will soon shift to equity shareholders. We expect additional dividend increases in upcoming quarters and would not be surprised to see the company initiate a share repurchase program in 2023. Read More >>