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Bellatrix embarks on light-oil venture with S. Korean partner

Our roundup of Canadian small-caps of between $100-million and $2.5-billion in market capitalization making news and on the move today.

Home Capital Group Inc. late Wednesday reported core EPS of $1.05, inline with Street expectations, and ahead of the $1 it made a year ago in earnings.

Management provided more disclosures on the loan exposure from the 45 suspended brokers. Total loan exposure from the suspended brokers is $1.72-billion as of Q3/15, down from $1.93-billion as of Q2/15.

"While the additional disclosures on the suspended brokers and the length of the ongoing investigation are unlikely to satisfy the skeptics, the fact remains that the quarter showed a rebound in originations (particularly non-single family) and continued strong credit performance and profitability," said analyst Dylan Steuart from iA Securities.

The Board of Directors of Home Capital Group Inc. has approved the payment of a quarterly dividend of 22.0 cents per share on the outstanding Common Shares of the Company, which is equivalent to an annual dividend of 88.0 cents per share.

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Bellatrix Exploration Ltd. announced third-quarter revenue of $82.066-million, down from $137.4-million a year ago. It saw an adjusted loss per share of 7 cents, reversing from a profit of 15 cents a year earlier. The results beat the Street estimates; analysts were expecting an adjusted loss of 8 cents per share on revenue of $76.15-million.

"The Company's 2015 corporate operating and financial guidance expectations remain firmly intact, and year to date performance has met or exceeded full year average guidance expectations. Actual year to date production volumes remain in-line with the high end of the previously announced guidance range, positioning the Company to grow 2015 full year average daily production volumes by approximately 9% relative to 2014, notwithstanding a more than 69% decrease in the Company's overall capital budget year over year," the company commented.

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Athabasca Oil Corp. reported a net loss of share in the third quarter of 9 cents, wider than the loss of 5 cents a year earlier.

The company has reduced its 2015 capital budget by an additional 10% to $256 million, with upwardly revised corporate exit  guidance between 12,000 - 15,000 boe/d (from 10,000 - 14,000 boe/d). The 2016 budget will be released in early December and in light of the commodity price environment, the company expects to implement a minimal capital program of less than $100 million to protect its balance sheet and liquidity position, Athabasca said.

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Essential Energy Services Ltd. announced third quarter revenue and EBITDAS of $47.8 million and $8.5 million, respectively, compared to $96.1 million and $22.7 million in the third quarter of 2014.

The company said its board has determined that a further dividend reduction is prudent. Starting with the November 4, 2015 dividend announcement, the quarterly dividend will be $0.003 per share, resulting in annualized savings of $6 million.

"In the near term, activity for the fourth quarter is expected to be slower than the third quarter of 2015 and significantly below the fourth quarter of 2014, as exploration and production companies reach their 2015 capital budget limits and cash flow remains constrained. Essential has reduced its 2015 capital spending plans by $3 million and expects to have annual capital spending in 2015 of $18 million," the company said.

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Newalta Corp. reported that its third-quarter revenue of $83.502-million was down sharply from $135.3-million a year earlier.

The company also slashed its dividend, "Third quarter revenue and Adjusted EBITDA were 38% and 54% lower than a year ago, in line with previous guidance, adjusted for the sub US$40 WTI oil prices in the quarter," said John Barkhouse, President and CEO. "While we offset some of this impact with significant cost reductions and the ongoing cash flows provided by our contract model, it's clear that new industry realities have set in. Accordingly, we triggered a third phase of our cost rationalization program which will drive an incremental $5 million in annualized savings. Lower overhead combined with growth initiatives will help to sustain our business but in this environment, additional action is warranted. Accordingly, the Board approved a 50% reduction to our quarterly dividend effective for the dividend payable to shareholders of record as of December 31, 2015. This reduction will preserve cash flow and align payouts with our previously stated strategic target of 15% to 20% of forward looking cash flows. These steps protect our balance sheet and ensure Newalta retains the strength to build on its environmental energy services industry leadership."

Analysts at TD Securities weren't impressed: "Newalta's Q3 results came in slightly below expectations, with ongoing restructuring costs likely the driver of the miss. However, we would expect investors to focus on two key points: first, the reduction in the dividend, which may disappoint some, and second, the removal of previously published 2016 EBITDAS sensitivities and reduced Q4 guidance. Given the magnitude of the drop expected in Q4 and absent a much quicker rebound in early 2016, our forecasts fall materially, lowering our target price to $10.00 (from $15.00). In addition, we are raising the risk rating on the stock to HIGH (from Medium), as we believe that its segments are not materially more insulated from industry cyclicality than the peer group," said TD analyst Scott Treadwell.