ENGLEWOOD, CO--(Marketwired - November 15, 2017) - PetroShare Corp. (
Third Quarter 2017 Highlights
- Revenues were $2.8 million for the three months ended September 30, 2017
- Net loss was $2.0 million and Adjusted EBITDA was $1.3 million for the three months ended September 30, 2017 (see further discussion regarding the presentation of Adjusted EBITDA in "Use of Non-GAAP Financial Measures" below)
Third Quarter 2017 Financial Results
The following tables present a comparison of results of operations for the three and nine months ended:
Net Sales Volumes | Three Months Ended 9/30/2017 |
Nine Months Ended 9/30/2017 |
||
Crude Oil (Bbls) | 46,392 | 158,124 | ||
Natural Gas Liquids (Bbls) | 15,985 | 36,562 | ||
Natural Gas (Mcf) | 175,659 | 381,735 | ||
Sales Volumes: (BOE) | 91,653 | 258,308 | ||
Average Daily Sales Volumes | ||||
Daily sales volumes (BOE/day) | 996 | 946 | ||
Product Price Received | ||||
Crude Oil ($/Bbl) | $45.14 | $45.06 | ||
Natural Gas Liquids ($/Bbl) | $16.14 | $15.61 | ||
Natural Gas ($/Mcf) | $2.77 | $2.78 | ||
Average Realized Price ($/BOE) | $30.97 | $33.90 | ||
Per Unit Cost Information ($/BOE) | ||||
Lease Operating Exp. | $2.09 | $2.40 | ||
Production Tax | $2.17 | $2.33 | ||
DD&A Expense | $12.72 | $12.27 | ||
Total G&A Expense | $16.52 | $16.96 | ||
Crude oil, natural gas and NGL sales revenue was $2.8 million, for the three months ended September 30, 2017 compared to $0.1 million for the three months ended September 30, 2016. The revenue that we reported in the third quarter of 2017 came from the sale of crude oil, natural gas and NGLs produced primarily from horizontal wells in which we participated as a non-operator and which were placed in service primarily during the first quarter of 2017, and to a much lesser extent, the vertical wells that we acquired during 2016.
The Company's 2017 third quarter net loss totaled $2.0 million, or $(0.09) per diluted share compared to a net loss of $1.2 million or $(0.05) per diluted share in the year ago quarter. Adjusted EBITDA in the third quarter was $1,289,857 as compared to $(637,987) in the year ago quarter.
Important Cautions Regarding Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking statements. The use of words such as "believes", "expects", "anticipates", "intends", "plans", "estimates", "should", "likely", "guidance" or similar expressions indicates a forward-looking statement. Forward-looking statements herein include statements regarding future transactions, plans and midstream issues. These statements are subject to risks and uncertainties and are based on the beliefs and assumptions of management, and information currently available to management. The actual results could differ materially from a conclusion, forecast or projection in the forward-looking information. Certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information. The identification in this press release of factors that may affect the Company's future performance and the accuracy of forward-looking statements is meant to be illustrative and by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. Factors that could cause the Company's actual results to differ materially from those expressed or implied by forward-looking statements include, but are not limited to: the success of the Company's exploration and development efforts; the price of oil and gas; worldwide economic situation; change in interest rates or inflation; willingness and ability of third parties to honor their contractual commitments; the availability of adequate midstream infrastructure, the Company's ability to raise additional capital, as it may be affected by current conditions in the stock market and competition in the oil and gas industry for risk capital; the Company's capital costs, which may be affected by delays or cost overruns; costs of production; environmental and other regulations, as the same presently exist or may later be amended; the Company's ability to identify, finance and integrate any future acquisitions; the volatility of the Company's stock price; and the other factors described in the "Risk Factors" sections of the Company's filings with the Securities and Exchange Commission, all of which are incorporated by reference in this release.
Reconciliation of Non-GAAP Financial Measures
We define adjusted EBITDA, a non-GAAP financial measure, as net (loss) adjusted to exclude the impact of the items set forth in the table below. We exclude those items because they can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, capital structures, and the method by which the assets were acquired. We believe that adjusted EBITDA is widely used in our industry as a measure of operating performance and may also be used by investors to measure our ability to meet debt covenant requirements. The following table presents a reconciliation of adjusted EBITDA to net (loss), its nearest GAAP measures.
PETROSHARE CORP. | |||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||
(unaudited) | |||||||||||
Three Months Ended September 30, | |||||||||||
2017 | 2016 | ||||||||||
Adjusted EBITDA: | |||||||||||
Net (loss) | $ | (2,031,072 | ) | $ | (1,152,045 | ) | |||||
Depletion, depreciation, and accretion | 1,191,890 | 39,064 | |||||||||
Stock-based compensation | 397,205 | 378,870 | |||||||||
Interest expense, net of interest income | 1,731,834 | 96,124 | |||||||||
Adjusted EBITDA | $ | 1,289,857 | $ | (637,987 | ) | ||||||
Condensed Consolidated Financial Statements
Condensed consolidated financial statements are included below. Additional financial information, including footnotes that are considered an integral part of the condensed consolidated financial statements, can be found in PetroShare's Quarterly Report on Form 10-Q for the period ended September 30, 2017, which is available at www.sec.gov.
PETROSHARE CORP. | ||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
(unaudited) | ||||||||||
ASSETS | September 30, 2017 |
December 31, 2016 |
||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 719,091 | $ | 2,449,412 | ||||||
Other current assets | 3,226,992 | 1,911,869 | ||||||||
Total current assets | 3,946,083 | 4,361,281 | ||||||||
Oil and gas properties and other equipment, net | 28,698,193 | 13,610,203 | ||||||||
Property, plant and equipment, net | 170,703 | 39,542 | ||||||||
Other assets | 103,707 | 15,758 | ||||||||
Total assets | $ | 32,918,686 | $ | 18,026,784 | ||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||
Current liabilities | 22,044,954 | 10,476,782 | ||||||||
Notes payable, net of issuance costs | 3,288,251 | 5,005,308 | ||||||||
Asset retirement obligations | 1,114,874 | 945,419 | ||||||||
Other liabilities | 127,527 | 23,128 | ||||||||
Total liabilities | 26,575,606 | 16,450,637 | ||||||||
Shareholders' equity: | ||||||||||
Common stock and paid-in capital | 21,097,802 | 11,427,189 | ||||||||
Accumulated deficit | (14,754,722 | ) | (9,851,042 | ) | ||||||
Total shareholders' equity | 6,343,080 | 1,576,147 | ||||||||
Total liabilities and shareholders' equity | $ | 32,918,686 | $ | 18,026,784 | ||||||
PETROSHARE CORP. | ||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||
(unaudited) | ||||||||||
Nine Months Ended September 30, | ||||||||||
2017 | 2016 | |||||||||
Cash flows from operating activities: | ||||||||||
Net (loss) | $ | (4,903,680 | ) | $ | (2,793,052 | ) | ||||
Adjustments to reconcile net (loss) to net cash provided by (used in) operating activities: | ||||||||||
Depletion, depreciation, and accretion | 6,770,357 | 43,425 | ||||||||
Stock-based compensation | 1,127,950 | 1,093,854 | ||||||||
Other, non-cash items | 34,716 | 26,880 | ||||||||
Changes in operating assets and liabilities | 1,067,260 | 1,225,324 | ||||||||
Net cash provided by (used in) operating activities | 4,096,603 | (403,569 | ) | |||||||
Cash flows from investing activities: | ||||||||||
Additions of property, plant and equipment | (79,886 | ) | (16,417 | ) | ||||||
Development of crude oil and natural gas properties | (8,082,911 | ) | (2,127,869 | ) | ||||||
Acquisitions of crude oil and natural gas properties - business combinations | - | (2,260,890 | ) | |||||||
Acquisitions of crude oil and natural gas properties | (3,003,339 | ) | (1,138,893 | ) | ||||||
Net cash used in investing activities | (11,166,136 | ) | (5,544,069 | ) | ||||||
Cash flows from financing activities: | ||||||||||
Equity financing activities | 8,891,712 | 95,000 | ||||||||
Debt financing activities | (3,552,500 | ) | 3,937,815 | |||||||
Net cash provided by financing activities | 5,339,212 | 4,032,815 | ||||||||
Net (decrease) in cash and equivalents | (1,730,321 | ) | (1,914,823 | ) | ||||||
Cash and equivalents at beginning of period | 2,449,412 | 3,011,291 | ||||||||
Cash and equivalents at end of period | $ | 719,091 | $ | 1,096,468 | ||||||
PETROSHARE CORP. | ||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||
(unaudited) | ||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||||
Crude oil, natural gas, and NGL revenues | $ | 2,838,192 | $ | 87,157 | $ | 8,757,079 | $ | 87,157 | ||||||||||
Costs and expenses: | ||||||||||||||||||
Lease operating expenses | 191,204 | 34,923 | 619,884 | 34,844 | ||||||||||||||
Production taxes, gathering and marketing | 268,550 | 29,793 | 753,190 | 35,465 | ||||||||||||||
Exploration costs | 708 | 14,740 | 67,382 | 17,440 | ||||||||||||||
Depletion, depreciation, and accretion | 1,191,890 | 39,064 | 3,241,569 | 43,425 | ||||||||||||||
Plugging expense | - | 33,847 | 23,123 | 33,847 | ||||||||||||||
Impairment of proved crude oil and natural gas properties | - | 9,841 | - | 26,880 | ||||||||||||||
General and administrative | 1,514,007 | 980,870 | 4,380,676 | 2,535,789 | ||||||||||||||
Total costs and expenses | 3,166,359 | 1,143,078 | 9,085,824 | 2,727,690 | ||||||||||||||
Operating (loss) | (328,167 | ) | (1,055,921 | ) | (328,745 | ) | (2,640,533 | ) | ||||||||||
Other income (expense): | ||||||||||||||||||
Other income | 28,948 | 33 | 29,194 | 534 | ||||||||||||||
Interest expense | (1,731,853 | ) | (96,157 | ) | (4,604,129 | ) | (153,053 | ) | ||||||||||
Total other (expense) | (1,702,905 | ) | (96,124 | ) | (4,574,935 | ) | (152,519 | ) | ||||||||||
Net (loss) | $ | (2,031,072 | ) | $ | (1,152,045 | ) | $ | (4,903,680 | ) | $ | (2,793,052 | ) | ||||||
Net (loss) per common share: | ||||||||||||||||||
Basic and diluted | $ | (0.09 | ) | $ | (0.05 | ) | $ | (0.22 | ) | $ | (0.13 | ) | ||||||
Weighted-average shares outstanding: | ||||||||||||||||||
Basic and diluted | 22,577,417 | 21,878,553 | 22,270,291 | 21,798,185 |
Contact Information:
Investor Relations Contacts
Jon B. Kruljac
303-520-7479
Email: jkruljac@petrosharecorp.com
Web: www.PetroShareCorp.com