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Agenda • Oil and gas industry in Canada o Overview o Characteristics o Main risks • Penn West Exp o Company profile o Risk management • Encana Corporation o Company profile o Risk management • Canadian Oil Sands o Company profile o Risk management
Canada is a Global Energy Player • Canada is the third owner of crude oil reserves in the world after Saudi Arabia and Venezuela • Canada is the third producer of natural gas in the world • Canada is the sixth largest oil producer in the world • Canada is second in the world in hydro-electricity generation.
Industry overview Canadian Oil & Gas Statistics (2012) • • 1. 31 million barrels per day of conventional oil production 1. 7 million barrels per day of oil sands production 13. 7 billion cubic feet per day of natural gas production $62 billion in capital spending $18 billion in taxes and royalties paid to governments Oil and gas industry currently supports 550, 000 jobs across Canada Oil and gas industry current comprises about 20% of the Toronto Stock Exchange
Petroleum regions in Canada • • 1 Western Canada Sedimentary Basin 2 Eastern Canada Sedimentary Basins 3 Southern Ontario Oil and Natural Gas Fields Regions 1 and of western and eastern Canada account for nearly all of the nation’s current crude oil and natural gas production.
Canadian Association of Petroleum Producers (CAPP) • The voice of Canada's upstream oil, oil sands and natural gas industry • It represents large and small producer member companies • Members explore for, develop and produce natural gas, natural gas liquid, crude oil and oil sands throughout Canada. • Produce about 90% of Canada’s natural oil and gas • Associate members provide a wide range of services that support the upstream crude oil and natural gas industry.
Main production • • • Natural gas liquids Crude oil Oil sands Elemental sulphur
Natural gas • Price determined in an open market • Supply of natural gas versus the demand for the fuel • Price Sensitivity – Residential – Commercial – Industrial – Winter Season – Higher crude oil prices – Economic growth
Natural gas liquids • Components of natural gas that are separated from the gas state in the form of liquids. This separation occurs in a field facility or in a gas processing plant. • Classified based on their vapor pressure
Crude oil • Actively traded commodities • Oil prices change daily • Global Trend – Demand rising steadily over the past 20 years – 60 million barrels per day to 84 million barrels per day. – Emerging Economies
Oil sands • Oil sand in Alberta is the largest, most developed and utilizes the most technologically advanced production processes • A naturally occurring mixture of sand, clay or other minerals, water and bitumen, which is a heavy and extremely viscous oil that must be treated before it can be used by refineries to produce usable fuels such as gasoline and diesel.
Canadian Oil Sands • Energy Efficiency Using less energy input. Reducing energy waste / losses. Capturing waste heat Cogeneration power / steam. • Improved Recovery Processes Lower temperature extraction. Additives to reduce use of both water and energy (steam). Use of electricity rather than steam. Underground combustion rather than steam. • Carbon Capture/Sequestration Most effective at upgraders.
Regulation Government: • Efficiency and market regulations (National Energy Board and Office of Energy Efficiency of Natural Resources Canada) • Environmental Regulations (Environment Canada) • Property Regulations (Provincial Government and Federal Government) Self-regulation: • Canadian Association of Petroleum Producers (CAPP)
Total Return Performance of Canadian Energy Sector
Recent transactions & trends • The Canadian transactions market has been very active • The year's most significant trend is the increased interest from Asian investors and the high-profile deliberations by the Canadian government about the implications of foreign investment in Canada’s oil and gas Industry.
Traditional risk exposure • Commodity price volatility • Business risk (production and sales uncertainty) • Macroeconomic influence • Credit risk (Counterparty failures) • Operational Risk (Pricing) • Environmental/legal risk(contract enforcement) (environmental protection and disaster prevention)
Others Pipeline approval Access to capital investment Global realignment of oil production Availability of unconventional hydrocarbon sources Underlying commodity supply and demand fundamentals • Foreign investment and M&A • • •
Risk management • Sensitivity analysis – On cash flows sensitive to: • Oil and gas prices • Interest rates • FX changes – Further developed with • Probability calculations for movements in prices, interest rates and FX
Commodity derivatives • The use of commodity derivatives can mitigate or remove oil or gas price uncertainty • Options, futures, swaps, forward contracts…
Contingent liability derivatives • On a diversified conventional reserve base with significant production history, predicting the future production performance over certain time horizon using type and decline curves is generally quite accurate • Companies with this sort of conventional reserve base can enter into contingent liability derivatives like swaps on a high percentage of their PDP(proved, developed, and producing) production with a high degree of confidence that the physical production to back any hedge liabilities will be there regardless of availability of future resources like capital and rigs to drill and complete future wells.
How to manage risk? What constitutes a sensible risk management program depends on context: • The nature of underlying reserves, the size, scale, maturity, and sophistication of the company's operations, the petroleum economics of the underlying asset(s). • Correctly utilized, hedging tools represent a useful way of underpinning value, maintaining liquidity, and managing credit risk. Incorrectly used they can amplify risk significantly.
Outlook for the Canadian Energy Industry • � Continued investment in the oil sands and other oil assets • � Increasing investment in unconventional gas • � Continued M&A activity — Joint ventures, acquisitions, asset transactions — Continued participation by international companies • � Technological advancement expected to continue • � Development of global infrastructure, including LNG • � Social and environmental issues will continue to be critical to Canadian operations
PENN WEST EXPLORATION
Overview of the company • Founded in 1979 in Calgary, Alberta • One of the largest conventional oil and natural gas producers in Canada • One of the S&P/TSX 60, the 60 largest companies on the Toronto Stock Exchange • More than 2, 000 employees • Total output: 56% oil and 44% natural gas • In 2011 the company converted from an income trust (Penn West Energy Trust) back into an independent corporation (Penn West Exploration).
Financial scenario • Market capitalization: 4. 22 Billion CAD • Enterprise value: 7. 14 Billion CAD • Shares outstanding: 489. 77 Million CAD Data from Reuters, Dec 2013
Development Penn West's Board of Directors has approved a capital budget of $900 million for 2014, with two thirds of the investment directed toward light oil opportunities resulting in the drilling of 210 net wells. The development program also includes integrated enhanced oil recovery (“EOR”) investments across our core areas. In 2014, Penn West will be transitioning to a more “even-flow” approach to our investment profile during the year. It was certainly true in 2013 and in the past that Penn West might commit as much as half of its annual capital budget in the first quarter – an approach that limits effectiveness, learning transfer and the ability to adjust programs as situations warrant. Generally, in 2014 and in subsequent years, we expect our development capital flow will approximate 25% to 30% of total year spending in quarters one, three and four with the small remainder dedicated to the spring break-up period in the second quarter.
Reserves The reserves estimates have been calculated in compliance with National Instrument 51 -101 Standards of Disclosure for Oil and Gas Activities ("NI 51 -101"). Under NI 51 -101, proved reserves estimates are defined as having a high degree of certainty with a targeted 90 percent probability in aggregate that actual reserves recovered over time will equal or exceed proved reserve estimates. For proved plus probable reserves under NI 51 -101, the targeted probability is an equal (50 percent) likelihood that the actual reserves to be recovered will be equal to or greater than the proved plus probable reserves estimate. The reserves estimates set forth below are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual reserves may be greater than or less than the estimates provided herein.
Historical price TSX NYSE 13/12/13 Price = 9. 10 13/12/13 Price = 8. 61
Management profile David E. Roberts President and Chief Executive Officer Mr. Roberts brings more than 30 years of operational experience in the upstream oil and gas business most recently as former Executive Vice President and Chief Operating Officer of Marathon Oil Corporation Todd H. Takeyasu Executive Vice President and Chief Financial Officer Todd is a Chartered Accountant with more than 25 years of oil and natural gas industry and public accounting experience. He has been with Penn West since 1994 in various positions Mark P. Fitzgerald Senior Vice President, Development Mark is a Professional Engineer who joined Penn West in 2008. Prior to his current role of Senior Vice President, Development, Mark was Senior Vice President of Production and Senior Vice President of Operations for Penn West.
Risk management at Penn West is exposed to a group of risks correlated to the activity it promotes in the sector of oil and natural gas production. Commodity price risk, foreign currency risk, credit risk, interest rate risk, liquidity risk, environmental and climate change. The company has got the aim to mitigate these risks throughout business strategies and management controls using determined financial instruments. As at December 31, 2012 and 2011, the only asset or liability measured at fair value on a recurring basis was the risk management asset and liability, which was valued based on “Level 2 inputs” being quoted prices in markets that are not active or based on prices that are observable for the asset or liability.
Hedging at Penn West “Penn West considers price hedging of oil and natural gas production to be a useful tool of risk management. Penn West continues to employ derivative instruments on a portion of its production volumes spanning several quarters into the future. The company also secured hedges to fix the costs of electric power at its oilfield operations, improving its ability to project operating costs, netbacks and cash flows. Penn West is careful and judicious in its hedging activities in order to preserve exposure to commodity price upside and avoid unreasonable opportunity costs”
Commodity price risk • The most important risk to hedge • This kind of risk is managend by using swaps, collars and other financial instruments • Limited to max of 50% of forecast sales volumes for current year plus 1 year forward and up to max of 25% for additional year thereafter.
Commodity price risk
Credit risk • There is risk if the counterparts does not pay back its obligation • There is Right to recover unpaid receivables by receiving the partner’s share of production where Penn West is the operator • For oil and gas sales, financial derivatives: limit credit risk by transacting only with institutions within credit facility, with high credit ratings, obtaining financial security.
Liquidity risk is the risk that the Company will be unable to meet its financial liabilities as they come due. Management utilizes short and long -term financial and capital forecasting programs to ensure credit facilities are sufficient relative to forecast debt levels, dividend and capital program levels are appropriate, and that financial covenants will be met. Management also regularly reviews capital markets to identify opportunities to optimize the debt capital structure on a cost effective basis. In the short term, liquidity is managed through daily cash management activities, short-term financing strategies and the use of collars and other financial instruments to increase the predictability of cash flow from operating activities.
Foreign exchange rate risk Prices received for crude oil are referenced to US dollars, thus Penn West’s realized oil prices are impacted by Canadian dollar to US dollar exchange rates. A portion of the Company’s debt capital is denominated in US dollars, thus the principal and interest payments in Canadian dollars are also impacted by exchange rates. When considered appropriate, the Company may use financial instruments to fix or collar future exchange rates to fix the Canadian dollar equivalent of crude oil revenues or to fix US denominated long-term debt principal repayments.
Interest rate risk A portion of the Company’s debt capital is held in floating-rate bank facilities which results in exposure to fluctuations in short-term interest rates which remain at lower levels than longer-term rates. From time to time, Penn West may increase the certainty of its future interest rates by entering fixed interest rate debt instruments or by using financial instruments to swap floating interest rates for fixed rates or to collar interest rates. As at December 31, 2012, four percent of the Company’s long-term debt instruments were exposed to changes in short-term interest rates (2011 – 19 percent). As at December 31, 2012, a total of $1. 9 billion (2011 – $2. 0 billion) of fixed interest rate debt instruments was outstanding with an average remaining term of 5. 5 years (2011 – 6. 5 years) and an average interest rate of 5. 8 percent (2011 – 5. 9 percent), including the effects of interest rate swaps.
Safety, environmental and regulatory risks Penn West is committed to minimizing the environmental impacts of our operations and to involving our stakeholders throughout the exploration, development, production and abandonment phases. Our environmental programs encompass stakeholder communication, impact minimization, resource conservation, and site abandonment and reclamation. Safety is an integral part of Penn West's activities. Safety programs protect not only the Company and its employees, but also friends, families, fellow workers, the public and the environment, from the far-reaching effects of serious accidents. Penn West's senior management is committed to continually improving safety standards, programs, training, awareness – and, most importantly, the safety of its employees and contractor's employees
Consolidated balance sheets
Consolidated statement of earnings
Consolidated statement of cash flows
Overview • Sector: oil, natural gas liquids and condensate • In striving to be the lowest-cost natural gas producer • The company plans to continue focusing capital investment in oil and liquids rich natural gas plays, minimizing investment in dry natural gas plays and attracting third party capital investments • In 2013 expectation of liquids production between 50, 000 and 60, 000 barrels per day • Strong liquidity position: in 2012 $3. 2 billion in cash and cash equivalent • Stable dividends • Joint venture with subsidiaries of Mitsubishi Corporation, Petro. China Company Limited and Toyota Tsusho Corporation
Management Doug Suttles President & Chief Executive Officer Before joining Encana, Doug held a number of senior leadership posts at BP, including Chief Operating Officer, BP Exploration & Production, and President, BP Alaska. Doug graduated from the University of Texas at Austin in 1983 with a B. S. , Mechanical Engineering. Sherri Brillon Executive Vice-President & Chief Financial Officer She served as Director of the Canadian Chamber of Commerce. Ms. Brillon holds an Economics degree from University of Calgary in 1981. Bob Grant Executive Vice-President, Corporate Development, EH&S & Reserves With over 30 years of experience in the oil and natural gas industry, Bob joined one of Encana’s predecessor companies in 1985. Bob graduated from Dalhousie University with a Bachelor of Science degree in engineering in 1975 and from Nova Scotia Technical College with a Bachelor in mechanical engineering in 1978.
Businesses Based on the Company’s operations and geographic locations as follows: • Canadian Division includes the exploration for, development of, and production of natural gas, oil and NGLs and other related activities within Canada. • �USA Division includes the exploration for, development of, and production of natural gas, oil and NGLs and other related activities within the U. S. • �Market Optimization is primarily responsible for the sale of the Company’s proprietary production. These results are included in the Canadian and USA Divisions. Market optimization activities include third party purchases and sales of product that provide operational flexibility for transportation commitments, product type, delivery points and customer diversification. • �Corporate and Other mainly includes unrealized gains or losses recorded on derivative financial instruments.
Resource play hub model Utilizes highly integrated production facilities and is used to develop resources by drilling multiple wells from central pad sites
Historical prices TSX NYSE 13/12/2013 Price = 19. 23 13/12/2013 Price = 18. 15
Hedging philosophy • Encana partially mitigates its exposure to financial risks through the use of various financial instruments and physical contracts. • The use of derivative financial instruments is governed under formal policies and is subject to limits established by the Board of Directors. • All derivative financial agreements are with major financial institutions in Canada and the U. S. or with counterparties having investment grade credit ratings. • The Company’s policy is not to utilize derivative financial instruments for speculative purposes.
Risk Management • Financial risks: ØMarket pricing of natural gas and liquids Ø�Credit ØLiquidity Ø�Foreign exchange rates Ø�Interest rates • �Operational risks • �Safety, environmental and regulatory risks
Unrealized Risk Management Positions
Earnings on Risk Management Positions
Commodity risk To partially mitigate commodity price risk, the Company may enter into transactions that fix or set a floor and cap on prices. To help protect against regional price differentials, Encana executes transactions to manage the price differentials between its production areas and various sales points. • Natural Gas - To partially mitigate the natural gas commodity price risk, the Company uses NYMEX swaps and options. To help protect against widening natural gas price differentials in various production areas, Encana has entered into basis swaps to manage the price differentials between these production areas and various sales points. • Crude Oil - To help protect against widening crude oil price differentials between North American and world prices, Encana has entered into fixed price contracts and basis swaps. • Power - The Company has entered into Canadian dollar denominated derivative contracts to help manage its electricity consumption costs.
Commodity price positions
Sensitivity analysis The Company has used a 10 percent variability to assess the potential impact of commodity price changes. Fluctuations in commodity prices could have resulted in unrealized gains (losses) impacting pre-tax net earnings as at December 31 as follows: Forecasts for 2014:
Credit risk • Counterparty and credit risks are regularly and proactively managed. • Credit exposure with customers in the oil and gas industry or financial institutions. • This credit exposure is mitigated through the use of Boardapproved credit policies governing the Company’s credit portfolio, including credit practices that limit transactions and grant payment terms according to counterparties’ credit quality. • As at December 31, 2012, approximately 88 percent (95 percent as at December 31, 2011) of Encana’s accounts receivable and financial derivative credit exposures were with investment grade counterparties. • As at December 31, 2012, Encana had two counterparties accounted for 22 percent and 15 percent of the fair value of the outstanding in-the-money net risk management contracts.
Liquidity risk • Access to cash equivalents and a wide range of funding alternatives at competitive rates through commercial paper, committed revolving bank credit facilities and debt capital markets. • Minimizes its liquidity risk by managing its capital structure. • It may adjust capital spending, adjust dividends paid to shareholders, purchase shares for cancellation pursuant to normal course issuer bids, issue new shares, issue new debt or repay existing debt.
Foreign exchange rate risk • As a means of mitigating the exposure to fluctuations in the U. S. /Canadian dollar exchange rate, Encana may enter into foreign exchange contracts. • Realized gains or losses on these contracts are recognized on settlement. • By maintaining U. S. and Canadian operations, Encana has a natural hedge. • Encana also maintains a mix of both U. S. dollar and Canadian dollar debt, which helps to offset the exposure to the fluctuations in the U. S. /Canadian dollar exchange rate. • In addition to direct issuance of U. S. dollar denominated debt, the Company may enter into cross currency swaps on a portion of its debt as a means of managing the U. S. /Canadian dollar debt mix.
Foreign exchange rate risk
Interest rate risk • The Company may partially mitigate its exposure to interest rate changes by holding a mix of both fixed and floating rate debt and entering into interest rate swap transactions. • As at December 31, 2012, the Company had no floating rate debt. Accordingly, the sensitivity in net earnings for each one percent change in interest rates on floating rate debt was nil (2011 - nil; 2010 - nil).
Operational risks • Operational risks are the risk of loss or lost opportunity from: Ø Reserves and resources replacement Ø �Capital activities Ø �Operating activities • If Encana fails to acquire or find additional natural gas and liquids reserves and resources, its reserves, resources and production will decline materially from their current levels and, therefore, its cash flows are highly dependent upon it. • To mitigate these risks, as part of the capital approval process, the Company’s projects are evaluated on a fully risked basis, including geological risk and engineering risk. • Encana also mitigates operational risks through a number of other policies, systems and processes as well as by maintaining a comprehensive insurance program.
Safety, environmental and regulatory risks • Encana’s operations are subject to regulation and intervention by governments that can affect or prohibit the drilling, completion, including hydraulic fracturing and tie-in of wells, production, the construction or expansion of facilities and the operation and abandonment of fields. • Changes in government regulation could impact the Company’s existing and planned projects as well as impose a cost of compliance.
Consolidated Statement of Earnings
Consolidated Statement of Comprehensive Income
Consolidated Balance Sheet (1/2)
Consolidated Balance Sheet (2/2)
Consolidated Statement of Cashflow (1/2)
Consolidate Statement of Cashflow (2/2)
CANADIAN OIL SANDS
Overview of the company • Canadian Based company. • The Company provides investment opportunity in the oil sands through its 36. 74% interest in the Syncrude Project. • The Company is the joint venture owner of the Syncrude Joint Venture (Syncrude), a producer of low sulphur, light, synthetic crude oil (SCO). • In 1978, Syncrude produced its first barrel of oil. • During the year ended December 31, 2011, Canadian Oil Sands estimates Syncrude’s proved plus probable reserves at 4. 8 billion barrels (1. 8 billion barrels net to the Company)
Management Key People Marcel R. Coutu • Mr. Marcel has been Chief Executive Officer and President of Canadian Oil Sands Limited since August 24, 2001 • Chairman of the Board of Syncrude Canada Ltd • More than 25 years of experience in the energy sector Ryan M. Kubik • Mr. Ryan has been Chief Financial Officer of Canadian Oil Sands Limited since April 2007 • He served as Treasurer of Canadian Oil Sands Limited from September 1, 2002 to April 2007 and served as its Acting Controller from July 2005 to July 2006. • More than 25 years of exeperience. Allen R. Hagerman • Mr. Allen has been Executive Vice President at Canadian Oil Sands Limited since April 2007 • He served as the Chief Financial Officer of Canadian Oil Sands Limited from June 1, 2003 to April 2007. • More than 25 years of experience in the financial management of energy companies.
Syncrude Project At-a-Glance
Reserves and Resources Based on independent reserves and resources estimates by GLJ Petroleum Consultants Ltd. as of December 31, 2012.
Historical Prices COS. TO on Toronto Stock Exchange
Risk Management Philosophy • COS approach Risk Management through process to identify, categorize and assess risk. • Syncrude canada, As operator of syncrude , Identify and assess the operational risk, Environmental Risk, Health& Safety risk that may impact its operations. • Risks are categorized based on their probability of occurrence and their potential impact o COS’ Future cash flows from operations, Net Income, Corporate reputation and H&S performance. • COS takes number of actions when risk have been identified and categorized including avoidance, Mitigation, Risk transfer and Acceptance.
Crude Oil Price Risk • The financial condition, operating results and future growth of Canadian Oil Sands are substantially dependent on prevailing and expected prices of oil. • Prices for oil are subject to large fluctuations in response to changes in the supply of and demand for oil, market uncertainty and a variety of additional factors, including access to markets and sufficient transportation capacity, all of which are beyond the control of Canadian Oil Sands. Prices are influenced by global and regional supply and demand factors • Canadian Oil Sands prefers to remain unhedged on crude oil prices; however, during periods of significant capital spending and financing requirements, management may hedge prices to reduce cash flow volatility. Canadian Oil Sands did not have any crude oil price hedges in place during 2012 or 2011; instead, a strong balance sheet was used to mitigate the risk around crude oil price movements.
Operational Risk • Equipment failures • Operator errors • Weather-related shutdowns • Catastrophic events • Project delay and failure to achieve objectives. • COS reduces exposure to some operational risks by maintaining appropriate level of Insurance. (e. g Approximately 1. 2$ Billion Property Insurance. )
Capital Expenditure Risk • The demand for skilled labour and other limited resources impacting operating expenses is having a similar effect on capital expenditures. • There is also a risk that capital maintenance at Syncrude will be required more often than currently planned, or that significant capital projects could arise that were not previously anticipated. • In addition, COS exposed to financing risks associated with funding its share of Syncrude’s capital program. • COS historically minimized this risk by diversifying its funding sources, which include credit facilities and cash flow from operations.
Foreign Currency Risk • Canadian Oil Sands’ results are affected by fluctuations in the U. S. /Cdn currency exchange rates, as sales generated are based on a WTI benchmark price in U. S. dollars while operating expenses and capital expenditures are denominated primarily in Canadian dollars. • Our sales exposure is partially offset by U. S. dollar obligations, such as interest costs on U. S. dollar-denominated long-term debt and our share of Syncrude’s U. S. dollar vendor payments. • In the past, the Corporation has hedged foreign currency exchange rates by entering into fixed rate currency contracts. The Corporation did not have any foreign currency hedges in place at December 31, 2011, and as at 2012, they do not intend to enter into any new currency hedge positions. The Corporation may, however, hedge foreign currency exchange rates in the future, depending on the business environment and growth opportunities.
Interest Rate Risk • Financial Results Impacted by U. S. and Canadian interest rate changes because its credit facilities and investments are exposed to its floating interest rate. • COS is exposed to the refinancing of maturing long-term debt at prevailing interest rates. • As at December 31, 2012, There was no drawn on the credit facilities (no amounts drawn on the credit facilities at December 31, 2011) and the next long-term debt maturity is in 2013. • COS did not has significant exposure to Interest rate risk due to short term nature of its Investment.
Liquidity Risk • Liquidity risk is the risk that Canadian Oil Sands will not be able to meet its financial obligations as they come due. • Canadian Oil Sands actively manages its liquidity through cash, debt and equity management strategies.
Credit Risk • Canadian Oil Sands is exposed to credit risk primarily through its trade accounts receivable balances with customers, with financial counterparties with whom the Corporation has invested its cash and from whom it has purchased term deposits, and with its insurance providers in the event of an outstanding claim. • Mitigated as accounts receivable with customers typically are settled in the month following the sale and Max exposure to any customer or counterparty is unchanged by credit policy. • The Corporation’s maximum credit exposure related to customer receivables was $311 million at December 31, 2011 and $376 million at Dec 31, 2012 (2009 - $329 million).
Syncrude Joint Venture Ownership Risk • Syncrude is a joint venture currently owned by seven participants. Each participant is entitled to one vote. • Operating decisions and those matters require a 51 per cent majority with at least three participants’ approving while major growth decisions outside of the original scope of the operations as well as producing multiple products rather than a single product require unanimous approval. • Canadian Oil Sands has a representative who chairs Syncrude’s Management Committee, which is a committee of the participants that determines the oversight of Syncrude. • Syncrude’s future plans will depend on such agreement and may depend on the financial strength and views of the other participants at the time such decisions are made.
Sensitivity Analysis • Canadian Oil Sands anticipates recording approximately $350 million in current taxes in 2013. These sensitivities are after the impact of taxes. • These sensitivities assume Canadian Oil Sands remains in minimum royalty in 2013.
Consolidated balance sheets
Consolidated statement of earnings
Consolidated statement of cash flows
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