Pengrowth Energy Corporation announced earnings and production results for the fourth quarter and full year 2017. The company achieved full year 2017 average daily production of 40,428 boe per day, which was at the mid-point of the company's production guidance of 39,500 to 41,500 boe per day.

Fourth quarter average daily production of 24,702 boe per day was slightly ahead of previous expectations for 24,500 boe per day. Fourth quarter and full year 2017 average daily production decreased 55% and 29%, respectively, compared to the same periods in 2016 mainly due to property divestments.

Funds flow from operations amounted to $13.5 million or $0.02 per share in the fourth quarter compared to funds flow of $111.7 million or $0.20 per share for the same period in 2016. The company recorded a net loss of $210.4 million in the fourth quarter of 2017 compared to a net loss of $92.4 million in the fourth quarter of 2016 primarily due to impairment of the Groundbirch E&E gas asset, lower funds flow from operations primarily related to divested properties, realized foreign exchange losses recorded in the quarter as a result of the settlement of U.S. dollar swap contracts and loss on extinguishment of debt as a result of the debt restructuring completed in the quarter. These were partly offset by unrealized foreign exchange gains recorded in the fourth quarter of 2017, lower unrealized commodity risk management losses and lower DD&A expenses.

Full year 2017 funds flow from operations of $69.4 million or $0.13 per share decreased 84% compared to funds flow of $429.7 million or $0.79 per share during the same period last year. The decrease in funds flow was primarily driven by divested properties which resulted in lower volumes year over year combined with realized commodity risk management losses. Full year 2017 net loss was $683.8 million compared to a net loss of $293.7 million in 2016. The loss was due to impairment charges of $634.4 million (approximately $463 million after-tax) coupled with lower funds flow from operations related to 2017 divestments, partly offset by the absence of unrealized commodity risk management losses recorded in 2016 and lower DD&A expenses.

The company's Board of Directors approved a 2018 capital expenditure budget of $65 million. 2018 capital spending will be focused on adding production volumes at the company's two 100% owned and operated assets at Lindbergh and Groundbirch. The 2018 capital budget is expected to grow production volumes through the course of the year from a December 2017 exit production rate of approximately 19,000 boe per day to an estimated 2018 exit rate of approximately 24,000 boe per day, representing double-digit production growth for 2018.