Arena Resources Announces First Quarter 2005 Financial and Operating Results; 226% Increase in Revenue for the Three Months to $3.9 Million; 324% Increase in Net Income for the Three Months to $1.3 Million.TULSA Tulsa (tŭl`sə), city (1990 pop. 367,302), seat of Tulsa co., NE Okla., on the Arkansas River east of its junction with the Cimarron; inc. 1898. , Okla. -- Arena Resources Inc. (AMEX AMEX See: American Stock Exchange : ARD Ard (ärd), in the Bible. 1 Son of Benjamin. 2 Benjamite, perhaps the same as (1.) An alternate form is Addar. ) (AMEX: ARD.WS) ("Arena")("company") announced today financial results for the first quarter ended March 31, 2005. Arena had net income of $1,313,253 or $0.12 per fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, on oil and gas revenues of $3,914,735 for the first quarter of 2005, compared to net income of $309,641, or $0.04 per fully diluted share, on oil and gas revenues of $1,200,400 for the quarter ended March 31, 2004. The revenue increase was due to increases in production volumes, primarily from acquisitions made in 2004 and 37% higher oil prices and 15% higher gas prices. For the three months ended March 31, 2005, oil sales volume increased to 77,260 barrels, compared to 33,783 barrels for the same period in 2004, a 129% increase. For the three months ended March 31, 2005, gas sales volume increased to 83,315 MCF MCF malignant catarrhal fever. (thousand cubic feet), compared to 19,323 MCF for the same period in 2004, a 331% increase. The average commodity prices received by Arena were $45.70 per barrel of oil and $4.61 per MCF of natural gas for the quarter ended March 31, 2005, compared to $33.24 per barrel of oil and $4.00 per MCF of natural gas for the quarter ended March 31, 2004. For the quarter ended March 31, 2005, the company had net cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses of $2,452,877, or $0.22 per fully diluted share, as compared to $618,088, or $0.08 per fully diluted share for the same period in 2004, an increase of 297% (1). Arena's Chief Executive Officer Tim Rochford stated, "We are extremely proud of the results for the first quarter. It has been another record quarter for us. As we continue to pursue acquisition opportunities, our primary focus has been on the development of our existing properties, with emphasis on our Fuhrman - Mascho and East Hobbs Hobbs, city (1990 pop. 29,115), Lea co., SE N.Mex.; inc. 1929. With the discovery (c.1928) of oil and natural gas in the area, Hobbs became one of the last great oil boomtowns in the United States. It remains a major shipping and trading center for oil-well supplies. Permian Basin The Permian Basin is a sedimentary basin largely contained in the western part of the U.S. state of Texas. It reaches from just south of Lubbock, Texas, to just south of Midland & Odessa, extending westward into the southeastern part of the adjacent state of New Mexico. leases acquired in 2004. We have moved a rig onto our Fuhrman - Mascho lease and have drilled the first two of 27 wells scheduled for 2005 on that property. We have also initiated our restimulation program using a 'slick frac' technology on the first of 20 targeted, low-producing wells. On our East Hobbs lease we are in the process of opening up additional production zones in selected wells, as well as finalizing the preparation of the lease for an initial waterflood Wa´ter`flood` n. 1. A flood of water; an inundation. recovery in three formations which is scheduled to commence in June June: see month. . We are encouraged by the initial results we have seen and are now evaluating expediting the development of these properties, subject to equipment availability." First Quarter Events --Warrant exercise and $5 million reduction in long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. . -- The company received $5,672,608 through the exercise of 1,163,269 warrants. $5 million of the proceeds was used to reduce long-term debt from $10 million to $5 million. --Credit Facility increase to $50 million, with $35 million immediate borrowing base. -- The company's credit facility with Mid First Bank of Oklahoma City Oklahoma City (1990 pop. 444,719), state capital, and seat of Oklahoma co., central Okla., on the North Canadian River; inc. 1890. The state's largest city, it is an important livestock market, a wholesale, distribution, industrial, and financial center, and a farm was increased from $25 million with an immediate borrowing base of $15 million, to $50 million with an immediate borrowing base of $35 million. The company currently has $5 million outstanding on this facility. --Acquisition of additional 17,500 undeveloped acres in Kansas Kansas, state, United States Kansas (kăn`zəs), midwestern state occupying the center of the coterminous United States. It is bordered by Missouri (E), Oklahoma (S), Colorado (W), and Nebraska (N). . -- In March, the company entered into a definitive agreement to acquire a total of 17,500 acres in Kansas. The Syracuse Syracuse, city, Italy Syracuse (sĭr`əky  s, –kyz), Ital. Siracusa, city (1991 pop. Prospect in Hamilton
County Hamilton County is the name of a number of counties in the United States of America, named for Alexander Hamilton, first United States Secretary of the Treasury (except as indicated below):
adj. 1. Almost exact or correct: the approximate time of the accident. 2. 13,000 acres. The Rocky Prospect in Greeley County Greeley County may refer to:
(1) Cash Flow from Operations is a non-GAAP financial measure that represents "Net Cash Provided By Operating Activities" adjusted for the change in operating assets Operating Assets Another term for working capital. and liabilities. See below for a reconciliation of the related amounts. About Arena Resources Inc. Arena Resources Inc. is an oil and gas exploration, development and production company with current operations in Texas, Oklahoma Oklahoma (ōkləhō`mə), state in SW United States. It is bordered by Missouri and Arkansas (E); Texas, partially across the Red R. (S, W); New Mexico, across the narrow edge of the Oklahoma Panhandle (W); and Colorado and Kansas (N). , Kansas and New Mexico New Mexico, state in the SW United States. At its northwestern corner are the so-called Four Corners, where Colorado, New Mexico, Arizona, and Utah meet at right angles; New Mexico is also bordered by Oklahoma (NE), Texas (E, S), and Mexico (S). . This release contains forward-looking statements 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. within the meaning of the "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. " provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 that involve a wide variety of risks and uncertainties, including, without limitations, statements with respect to the company's strategy and prospects. Readers and investors are cautioned that the company's actual results may differ materially from those described in the forward-looking statements due to a number of factors, including, but not limited to, the company's ability to acquire productive oil and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. gas properties or to successfully drill and complete oil and/or gas wells on such properties, general economic conditions both domestically and abroad, and the conduct of business by the company, and other factors that may be more fully described in additional documents set forth by the company.
CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended
March 31,
2005 2004
(Unaudited) (Unaudited)
----------- -----------
Oil and Gas Revenues $3,914,735 $1,200,400
----------- -----------
Costs and Operating Expenses
Oil and gas production costs 812,237 316,290
Oil and gas production taxes 286,717 78,707
Depreciation, depletion and amortization 421,599 111,120
General and administrative expense 269,505 178,202
----------- -----------
Total Costs and Operating Expenses 1,790,058 684,319
----------- -----------
Other Income (Expense)
Gain from change in fair value of put
options 74,046 -
Accretion expense (22,071) (12,295)
Interest expense (93,399) (9,113)
----------- -----------
Net Other Expense (41,424) (21,408)
----------- -----------
Income Before Provision for Income Taxes 2,083,253 494,673
Provision for Deferred Income Taxes (770,000) (185,032)
----------- -----------
Net Income $1,313,253 $309,641
=========== ===========
Basic Income Per Common Share 0.13 0.04
Diluted Income Per Common Share 0.12 0.04
Basic Weighted-Average Common Shares
Outstanding 9,792,744 7,163,734
Diluted Weighted-Average Common Shares
Outstanding 11,284,939 7,836,914
COMPARATIVE OPERATING STATISTICS
(Unaudited)
Three Months Ended
------------------
3/31/05 3/31/04 Change
--------------------------
Net Production -- BOE per day 1,013 407 +149%
Per BOE:
Average Sales Price $42.95 $32.44 +32%
Operating Costs 12.06 10.67 +13%
DD&A 4.63 3.00 +54%
General & Administrative Expenses 2.95 4.82 -39%
Interest Expense 1.02 .25 +308%
CONDENSED BALANCE SHEET DATA
March 31, Dec. 31,
2005 2004
(Unaudited) (Audited)
----------- ---------
Assets
Current assets $ 3,336,506 $ 2,498,423
Properties, buildings & equipment, net 34,570,693 32,943,884
Other assets & deposits 533,719 900,000
----------- -----------
$38,440,918 $36,342,307
=========== ===========
Liabilities & Shareholders' Equity
Current Liabilities $ 973,791 $ 1,840,665
Deferred income taxes 2,899,993 2,129,993
Long-term debt 5,400,000 10,400,000
Other long-term liabilities 1,311,051 1,363,026
Shareholders' Equity 27,856,083 20,608,623
----------- -----------
$38,440,918 $36,342,307
=========== ===========
CONDENSED STATEMENTS OF CASH FLOW
Three Months Ended
March 31,
2005 2004
(Unaudited) (Unaudited)
----------- -----------
Cash flows from operating activities:
Net income $ 1,313,253 $ 309,641
Depreciation, depletion & amortization 421,599 111,120
Deferred income taxes 770,000 185,032
Other, net (51,975) 12,295
Net changes in operating assets and
liabilities (1,194,512) (49,378)
------------ ------------
Net Cash Provided by Operating Activities 1,258,365 568,710
Net Cash Used in Investing Activities (1,420,527) (314,066)
Net Cash Provided by (Used in) Financing
Activities 672,607 (93,038)
------------ ------------
Net Increase in Cash 510,445 161,606
Cash at Beginning of Period 1,253,969 1,076,676
------------ ------------
Cash at End of Period $ 1,764,414 $ 1,238,282
============ ============
RECONCILIATION OF CASH FLOW FROM OPERATIONS
Net cash provided by operating activities $ 1,258,365 $ 568,710
Change in operating assets and liabilities $ 1,194,512 $ 49,378
------------ ------------
Cash flow from operations $ 2,452,877 $ 618,088
============ ============
Management believes that the non-GAAP measure of cash flow from operations is useful information for investors because it is used internally and is accepted by the investment community as a means of measuring the company's ability to fund its capital program. It is also used by professional research analysts in providing investment recommendations pertaining per·tain intr.v. per·tained, per·tain·ing, per·tains 1. To have reference; relate: evidence that pertains to the accident. 2. to companies in the oil and gas exploration and production industry. |
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