DENVER, CO — (Marketwire) — 11/13/12 — (NYSE MKT: ESTE) reported net income of $486,000, or $0.28 per diluted share, on revenue of $2,809,000 for the second quarter of fiscal 2013, ended September 30, 2012 (2012). This compares to net income of $728,000, or $0.43 per diluted share, on revenue of $2,545,000 for the quarter ended September 30, 2011 (2011). For the first half of fiscal year 2013, the Company reported net income of $756,000, or $0.44 per share, on revenue of $5,156,000, compared to net income of $1,393,000, or $0.81 per share, on revenue of $5,070,000 for the six months ended September 30, 2011. For the quarter, total revenue increased and net income decreased $264,000 (10%) and $242,000 (33%), respectively, from the comparable prior year period. The increase in total revenue was due primarily to higher oil production, which was nearly offset by lower oil and gas prices. Net income decreased due to higher depletion and general & administrative expenses, in addition to higher production taxes in 2012 relative to 2011. Other factors which contributed to our quarterly results are disclosed in the Company–s most recent Form 10-Q.
“We are pleased to see the results of our recent drilling efforts as this quarter we posted solid gains in oil production and reserves; nearly 25% and 22%, respectively,” commented Ray Singleton, President of Earthstone. “We expect this trend to continue, as our increased exploration efforts lead the way to higher reserves and production rates. Year-to-date, our capital deployment increased on an accrual basis 82% over the same period last year. Based on this, by year-end, we expect to easily double last year–s capital expenditures. This continues a trend, as last year–s capex doubled the previous year–s expenditures. Our general and administrative expenses continue to increase, but are directly attributable to significant additions to the operational capability of our staff. The Company continues to pursue its strategy of drilling non-operated, horizontal Bakken wells along with the acquisition of producing properties in the Montana and North Dakota portions of the Williston Basin. The next few months should be exciting. With a number of efforts both underway and in the planning process, we eagerly anticipate increasing the Company–s production and reserves the remainder of this year.”
There continues to be excellent potential for reserve growth in the Banks area, where we placed nine new wells on production this year. These wells, the Garmann 19-18 #1H, Sax 25-36 1H, Skarston 1-12 1H, Knight 35-26 1H, Jay 24-13 1H and, Maston 34-27 1H, operated by Brigham, the Chameleon State 153-97-16-21-1H and the Chameleon State 153-97-16-21-2H, operated by Oasis and ZI Nelson 11-2H, operated by Zenergy, have an average of 3.14% working interest.
The Federal #1-5H, a horizontal Ratcliffe formation well, has finally been placed on production, where progress by the operator, Vess Corporation, has been painfully slow on federal lands. At this time the well has not been released from confidential status, and as such, production information is not available.
Earthstone Energy, Inc. is a growth-oriented independent oil and gas exploration and production company with primary operations in the Williston Basin and southern Texas. Earthstone is currently traded on NYSE MKT under the symbol ESTE. Information on Earthstone can be found at its web site: .
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. Some statements contained in this release are forward-looking, and therefore involve uncertainties or risks that could cause actual results to differ materially. Forward-looking statements can be identified by words such as “should,” “may,” “will,” “anticipate,” “expect,” “estimate,” “intend” or “continue,” or comparable words or phrases. In addition, all statements other than statements of historical facts that address activities that Earthstone intends, expects or anticipates will or may occur in the future are forward-looking statements. Forward-looking statements also include comments regarding assumptions regarding production rates and growth, operating costs, reduction of operation costs, commodity prices, industry outlook, future drilling activities, acquisitions and industry opportunities. Factors that could cause actual results to differ materially include availability of rigs and services, price volatility of oil and gas, estimated production rates and adjustments to ownership percentages in addition to economic and political events affecting supply and demand for oil and gas, loss of customers for oil and gas production and government regulations. These and other factors are discussed in more detail in Earthstone Energy–s filings with the Securities and Exchange Commission, including the Company–s Annual Report on Form 10-K filed for March 31, 2012 and Quarterly Reports on Form 10-Q for the three and six months ended June 30, 2012 and September 30, 2012, respectively. The Company disclaims any obligation to update forward-looking statements.
Contact Information:
Ray Singleton
303-296-3076, ext. 102
633 Seventeenth Street, Ste. 1900
Denver, CO 80202-3619
(303) 296-3076
(303) 773-8099 Fax