Abraxas Announces 2002 Financial Results and Year End Reserves; Results from Recently Sold Canadian Operations Classified as `Discontinued Operations'.Energy Editors/Business Editors SAN ANTONIO--(BUSINESS WIRE)--March 25, 2003 Abraxas A`brax´as n. 1. A mystical word used as a charm and engraved on gems among the ancients; also, a gem stone thus engraved. Petroleum Corporation (AMEX AMEX See: American Stock Exchange :ABP 1. (networking) ABP - Alternating bit protocol. 2. ABP - Microsoft Address Book Provider. ) today reported financial and operating results for the fourth quarter and the full year ended December December: see month. 31, 2002. Due to required accounting treatment under GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). , results for all reported periods related to the Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. operations sold in January January: see month. 2003 have been classified as "Discontinued Operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. " on the Company's Statements of Operations and as "Assets Held for Sale" on the Company's Balance Sheet. Consequently any comparisons or discussions contained herein, unless specifically identified to Discontinued Operations, are related to continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the only. Continuing Operations: Revenues in the fourth quarter of 2002 were $6.9 million compared to $5.0 million in 2001. Net earnings for the fourth quarter of 2002 were a loss of $6.7 million compared to a loss of $9.2 million in 2001. Higher commodity price realizations in Q4 2002, $3.85 per Mcfe, compared to Q4 2001, $2.26 per Mcfe, was the driver behind the increase in revenues and the narrower loss. For the full year of 2002, a net loss of $60.8 million was incurred compared to a loss of $16.0 million in 2001. Included in the full year 2002 loss was a non-cash proved property impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. (ceiling test) charge of $32.9 million. As Reported Including Discontinued Operations: The net loss for the fourth quarter of 2002 was $5.7 million including a gain of $976,000 from discontinued operations. This compares to a loss of $12.9 million in the fourth quarter of 2001 including a loss from discontinued operations of $3.7 million. The reported loss for the full year of 2002 was $118.5 million including a loss from discontinued operations of $57.7 million and impairment charges totaling $86.3 million. During 2001 the Company reported a loss of $19.7 million including a loss of $3.7 million from discontinued operations. The 2001 numbers do not include any impairment charges. The Company reported 112.5 Bcfe of proven reserves at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. 2002 with a PV-10 of $137 million. Additional operational detail, including production data, price realizations, reserve breakdown breakdown /break·down/ (brak´doun) 1. the act or process of ceasing to function. 2. an often sudden collapse in health. 3. loss of self-control. and other pertinent PERTINENT, evidence. Those facts which tend to prove the allegations of the party offering them, are called pertinent; those which have no such tendency are called impertinent, 8 Toull. n. 22. By pertinent is also meant that which belongs. Willes, 319. information for the comparable fourth quarters of 2001 and 2002, as well as full year comparisons, can be found in the attached tables. The Company has also attempted to provide the reader with a better understanding of the impact on the Company's balance sheet of the transactions completed in January of 2003, specifically the Canadian sale, the new senior credit agreement and the exchange offer all previously announced on January 24, 2003. An unaudited pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma balance sheet at December 31, 2002, giving effect to the results of the transactions discussed above can be found in the attached tables. Abraxas CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Bob Watson
v. 1. To duplicate, copy, reproduce, or repeat. 2. To reproduce or make an exact copy or copies of genetic material, a cell, or an organism. n. A repetition of an experiment or a procedure. the value creation demonstrated in our Canadian sale." As a result of final 2002 financial results and current market conditions, Abraxas has updated its operating and financial guidance for year 2003 as follows: Production: BCFE (approximately 80% gas) 7 - 8 Price Differentials (Pre Hedge): $ Per BO 0.64 $ Per MCF 0.51 Lifting Costs, $ Per MCFE 1.21 G&A, $ Per MCFE 0.69 Capital Expenditures ($ Millions) 15.00 Abraxas invites your participation in a conference call on Wednesday Wednesday: see week. , March 26th, at 1:30 pm CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. to discuss the contents of this release and respond to questions. Please call 1-800-967-7140 between 1:20 and 1:30 pm CST, confirmation code 729258, if you would like to participate in the call. There will be a replay of the conference call available by calling 1-888-203-1112, confirmation code 729258, beginning approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 4:30 pm CST Wednesday, March 26th, through 5:00 pm CST Wednesday, April 2nd. Abraxas Petroleum Corporation is a San Antonio-based crude oil and natural gas exploitation Exploitation See also Opportunism. Barnum, P. T. (1810–1891) circus impressario famous for his saying, “Never give a sucker an even break.” [Am. Hist. and production company. The Company operates in Texas, Wyoming Wyoming, city, United States Wyoming, city (1990 pop. 63,891), Kent co., W Mich., in the greater Grand Rapids metropolitan area, on the Grand River; settled 1832, inc. 1959. and western Canada
Western Canada, commonly referred to as the West . Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. for forward-looking statement forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. : Statements in this release looking forward in time involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to be materially different from any future performance suggested in this release. Such factors may include, but may not be necessarily limited to, changes in the prices received by the Company for crude oil and natural gas. In addition, the Company's future crude oil and natural gas production is highly dependent upon the Company's level of success in acquiring or finding additional reserves. Further, the Company operates in an industry sector where the value of securities is highly volatile With regard to computer memory, it means "temporary" and not "highly changeable," which is the usual meaning of the word. See volatile memory. 1. (programming) volatile - volatile variable. 2. (storage) volatile - See non-volatile storage. and may be influenced by economic and other factors beyond the Company's control. In the context of forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. information provided for in this release, reference is made to the discussion of risk factors detailed in the Company's filing with the Securities and Exchange Commission during the past 12 months.
Abraxas Petroleum Corporation and Subsidiaries
Consolidated Statements of Operations
Three Months Twelve Months
(In thousands except per share Ended Ended
data) December 31, December 31,
----------------- ------------------
2002 2001 2002 2001
----------------- ------------------
Revenue:
Oil and gas production revenues $6,796 $4,812 $21,601 $34,934
Rig revenues 123 149 635 756
Other 1 2 71 85
------- --------- -------- ---------
6,920 4,963 22,307 35,775
Operating costs and expenses:
Lease operating and production
taxes 2,109 2,465 7,910 9,302
Depreciation, depletion, and
amortization 2,300 2,752 9,654 12,336
Proved Property impairment -- -- 32,850 --
Rig operations 128 154 567 702
Stock-based compensation -- -- -- (2,767)
General and administrative 1,556 885 5,082 4,937
------- --------- -------- ---------
6,093 6,256 56,063 24,510
------- --------- -------- ---------
Operating income (loss) 827 (1,293) (33,756) 11,265
Other (income) expense:
Interest income (36) (312) (92) (78)
Amortization of deferred
financing fees 331 865 1,325 1,907
Interest expense 6,040 6,272 24,689 23,922
Financing costs 967 -- 967 --
Loss (gain) on sale of equity
investment -- 845 -- 845
Other 201 191 201 207
------- --------- -------- ---------
7,503 7,861 27,090 26,803
Income (loss) from continuing
operations before taxes and
extraordinary gain (6,676) (9,154) (60,846) (15,538)
Income tax expense (benefit) -- -- -- 505
-------- --------- ---------- ---------
Income (loss) from continuing
operations before
extraordinary item (6,676) (9,154) (60,846) (16,043)
Income (loss) from discontinued
operations 976 (3,696) (57,681) (3,675)
------- --------- ---------- ---------
Income (loss) before
extraordinary item (5,700) (12,850) (118,527) (19,718)
Debt extinguishment -- -- -- --
-------- --------- ---------- ---------
Net income (loss) ($5,700) ($12,850) ($118,527) ($19,718)
======== ========= ========== =========
Earnings (loss) per common
share:
Net income (loss) from
continuing operations before
extraordinary item ($0.22) ($0.31) ($2.03) ($0.62)
Discontinued operations
(loss) 0.03 (0.12) (1.92) (0.14)
Extraordinary item -- -- -- --
-------- --------- ---------- ---------
Net income (loss) per common
share ($0.19) ($0.43) ($3.95) ($0.76)
======== ========= ========== =========
ABRAXAS PETROLEUM CORPORATION
YEAR-END RESULTS
Three Months Twelve Months
(In thousands except Ended December 31, Ended December 31,
per share data 2002 2001 2002 2001
----------------------------------------
Continuing Operations Data:
Revenues $6,920 $4,963 $22,307 $35,775
EBITDA 3,127 1,459 8,748 20,834
Cash Flow (Before Working
Capital Changes) (4,044) (4,692) (17,017) (3,722)
Continuing Operations Net Loss (6,676) (9,154) (60,846) (16,043)
Continuing Operations Net Loss
Per Share (.22) (.31) (2.03) (.62)
Net Income (loss) from
Discontinued Operations 976 (3,696) (57,681) (3,675)
Net Income (loss) from
Discontinued Per Share .03 (.12) (1.92) (.14)
Reported Net Loss (5,700) (12,850) (118,527) (19,718)
Reported Net Loss Per Share (.19) (.43) (3.95) (.76)
Weighted Ave. Shares
Outstanding (Millions) 30.0 30.0 30.0 25.8
Production:
Crude Oil (BPD) 742 825 725 999
NGL (BPD) 30 184 26 141
Natural Gas (MCFPD) 14,551 17,500 15,561 21,433
MMCFEPD 19.2 23.6 20.1 28.3
Prices (net of hedge costs):
Crude Oil ($/BBL) $30.91 $18.68 $24.42 $25.07
NGL's ($/BBL) 18.57 11.93 14.88 15.61
Natural Gas ($/MCF) 3.46 2.04 2.64 3.19
Price per MCFE 3.85 2.26 2.95 3.39
Expenses:
Lease Operating ($/MCFE) $1.19 $1.14 $1.08 $.90
General & Administrative
($/MCFE) .88 .45 .69 .48
Interest ($/MCFE) 3.40 2.75 3.36 2.31
D/D/A ($/MCFE) 1.30 1.27 1.32 1.20
Reserves:
Consolidated PV-10 $136,584 $77,187
U.S. Reserves (Bcfe) 97.6 134.9
Canada Reserves (Bcfe) 14.9 7.2
Balance Sheet Data (In $000s)
Year End Year End
December 31, December 31,
2002 2001
------------ ------------
Cash $557 $3,593
Working Capital (Deficit)(a) (67,547) (2,982)
Property and Equipment, Net 95,926 127,486
Total Assets(b) 181,425 303,616
Long-Term Debt(c) 190,979 262,240
Shareholders Equity (Deficit) (142,254) (28,585)
Actual Common Shares Outstanding
(Millions) 30.0 30.0
(a) 2002 Working capital includes a current liability of $63.5
million for senior secured notes which were paid off on January 23,
2003. It does not include assets and liabilities held for sale for
either period.
(b) Total Assets include assets held for sale (total assets from
continued operations equal $107.2 million for 2002 and $139.7 million
for 2001)
(c) 2002 Long-term debt includes the second lien and old notes that
were exchanged in the tender offer in January 2003.
ABRAXAS PETROLEUM CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEET AT DECEMBER 31, 2002
-------------------------
AS REPORTED
ON 10-K PROFORMA(a)
(Audited) (Unaudited)
-------------------------
(Dollars in Thousands)
ASSETS:
Current Assets $7,923 $7,923
Assets held for sale 74,247 --
Property and Equipment - Net 95,926 95,926
Other Assets 3,329 5,844
-------------------------
Total Assets $181,425 $109,693
-------------------------
LIABILITIES & STOCKHOLDERS' DEFICIT:
Current liabilities $75,470 $6,970
Liabilities related to assets held for
sale 56,697 --
Long-term debt 190,979 175,298(b)
Other liabilities 533 533
Stockholders' equity (deficit) (142,254) (73,108)(c)
-------------------------
Total liabilities and
stockholders' equity (deficit) $181,425 $109,693
-------------------------
(a) Gives effect as to the sales of Canadian Abraxas Petroleum Ltd.
and Grey Wolf Exploration Inc., the closing of the Company's new
senior credit agreement, the redemption of the Company's previous
first lien notes and the completion of the exchange offer related
to the Company's former second lien and old notes, as if all
transactions happened at December 31, 2002.
(b) Consists of new senior credit agreement with outstanding
balance of $46.7 million and $128.6 million which represents
the carrying value of the $109.7 million face amount of the
newly exchanged notes, due in May 2007.
(c) Reflects estimated gain on sale of Canadian subsidiaries to be
booked in the first quarter 2003 (approximately $69 million),
minus transaction costs of exchange offer that will be expensed
(approximately $3.6 million), plus issuance of new shares related
to the exchange offer (approximately $3.8 million).
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