TORONTO, May 7 (Reuters) - Gran Tierra Energy, the most recent target of activist investor West Face Capital, reported a much wider than expected first-quarter net loss, as the pullback in oil prices weighed on the oil and gas company’s results.
Calgary-based Gran Tierra late on Wednesday reported a net loss of $44.9 million or 16 cents a share. That compared with a year ago profit of $45.1 million, or 16 cents a share.
Excluding certain one-time items Thomson Reuters I/B/E/S pegged the loss at 13 cents a share, below average analysts’ estimates for a loss of 3 cents a share.
Last month, Canadian activist firm West Face Capital Inc launched a proxy battle against Gran Tierra and outlined plans to put up a slate of six nominees for the energy firm’s board, saying that its current four-member board has failed investors.
West Face, whose managed funds control roughly 9.8 percent of Gran Tierra’s shares, contend the current board has overseen a failed high-risk, high-cost exploration strategy in Peru, Argentina and Brazil that has led to the destruction of more than half the company’s market value since the start of 2011.
Gran Tierra, which has been hit hard by the slide in oil and gas prices, defended its board and said it is making significant cost cuts across its operations and is taking “decisive action to reshape the company and usher in a new era at Gran Tierra.”
The company said it is focused on its Colombian properties and is curtailing spending elsewhere, which is one of West Face’s key demands.
Gran Tierra said it is confident the actions it has taken better position it for growth and value creation despite what continues to be a challenging lower oil price environment.
Quarterly revenue nearly halved to $76.7 million. (Reporting by Euan Rocha; Editing by Chizu Nomiyama)