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MEG Energy CEO deflects takeover speculation as company reports Q3 loss

Last Updated Oct 27, 2020 at 1:15 pm MDT

The corporate logo of MEG Energy Corp. is shown. THE CANADIAN PRESS/HO

CALGARY — The CEO of MEG Energy Corp. says it’s business as usual for the oilsands producer despite speculation it could be a takeover target in the wake of the $3.8-billion buyout of Husky Energy Inc. announced by Cenovus Energy Inc. on Oct. 25, 2020.

RELATED: Cenovus to cut hundreds of jobs after merger with Husky Energy

Derek Evans says the Calgary-based company doesn’t consider itself a “driver” in the consolidation business and is concentrating on continuing to operate its business as the largest remaining pure-play bitumen producer in the oilsands.

Analysts Dennis Fong of CIBC and Phil Skolnick of Eight Capital, however, said in separate reports they still consider MEG the most logical target if consolidation continues in the oilsands.

Skolnick points out, however, that there’s no pressure on MEG to do a deal because it is well supplied with cash and its earliest maturing long-term debt doesn’t come due until March 2024.

READ MORE: Cenovus targets 20 to 25 per cent workforce reductions following Husky takeover

The company posted its third consecutive quarterly net loss of $9 million or three cents per share for the three months ended Sept. 30, compared with a $24 million profit a year earlier.

Revenue decreased to $533 million from $958 million in the third quarter of 2019 on lower prices and lower bitumen production as it completed a 75-day maintenance shutdown in August.

MEG’s revenue and net loss beat analyst expectations of a loss of 16 cents per share on $490 million of revenue, according to financial markets data firm Refinitiv.

This article includes excerpts from The Canadian Press.