U.S. Energy Corp. (NASDAQ:USEG) (“U.S. Energy” or
the “Company”) today announced financial and operational results
for the quarter ended June 30, 2017, mid-year proved oil & gas
reserves, and Revolving Credit Facility (“Credit Facility”)
updates.
Highlights
- Second quarter production of 58,369 BOE increased 17% as
compared to the first quarter of 2017. Daily production
averaged 641 BOEPD;
- Second quarter oil and gas revenue of $2.0 million increased
17% as compared to the first quarter of 2017;
- Second quarter lease operating expenses of $0.5 million, or
$9.18 per BOE, decreased 35% as compared to the first quarter of
2017;
- Second quarter Adjusted EBITDA of $0.4 million;
- Total proved reserves of 1,458 MBOE at 6/30/2017;
- PV-10 of $13.9 million at 6/30/2017;
- Cash and cash equivalents of $2.0 million at 6/30/2017;
- Current shares outstanding of 6,134,506; and
- Extended maturity of Credit Facility to 7/30/2019 and set new
financial ratio covenants
Second Quarter 2017
Production
For the second quarter of 2017, U.S. Energy’s
total production volumes on a BOE basis increased 17% as compared
to the first quarter of 2017. During the second quarter of 2017,
U.S. Energy realized a $44.19 average price per Bbl of oil compared
to an $42.70 average price per Bbl of oil during the first quarter
of 2017.
|
|
2nd Quarter 2017 |
|
1st Quarter 2017 |
Sales Volume
(Total) |
|
|
|
|
Oil (Bbls) |
|
36,004 |
|
29,036 |
Gas (Mcf) |
|
134,187 |
|
125,094 |
Sales volumes
(Boe) |
|
58,369 |
|
49,885 |
|
|
|
|
|
Average Sales
Prices |
|
|
|
|
Oil (Bbl) |
$ |
44.19 |
$ |
42.70 |
Gas (Mcf) |
$ |
2.99 |
$ |
4.05 |
Barrel of Oil
Equivalent
|
$ |
34.13 |
$ |
35.02 |
2017 Mid-Year Reserves
As of June 30, 2017, U.S. Energy had total
proved reserves of approximately 1,458 MBoe, all of which are
proved developed producing reserves (“PDP”). The proved reserves
total had a pre-tax PV10% value of $13.9 million.
|
|
|
As of 6/30/2017 |
Proved Developed Oil
Reserves (MBbls) |
|
|
1,234 |
Proved Undeveloped Oil
Reserves (MBbls) |
|
|
- |
Total Proved Oil
Reserves (MBbls) |
|
|
1,234 |
|
|
|
|
Proved Developed Gas
Reserves (MMcf) |
|
|
1,347 |
Proved Undeveloped Gas
Reserves (MMcf) |
|
|
- |
Total Proved Gas
Reserves (MMcf) |
|
|
1,347 |
|
|
|
|
Total Proved Reserves
(MBoe) |
|
|
1,458 |
|
|
|
|
Present Value of
Estimated Future Net Revenues Before
Income Taxes, Discounted at 10% (In
thousands)* |
|
$ |
13,930 |
*SEC pricing of $48.95/bbl of oil and
$3.01/mcf of gas
Financial Results
Revenues from sales of oil and natural gas for
the second quarter of 2017 were $2.0 million compared to $1.7
million for the first quarter of 2017. The 17% quarter over
quarter increase in revenue is primarily associated with an
increase in production. Revenue from oil production represented 80%
of Company revenue during the second quarter of 2017.
Lease operating expenses for the second quarter
of 2017 were $0.5 million compared to $0.7 million for the first
quarter of 2017. On a per unit basis, lease operating
expenses were $9.18 per BOE in the second quarter of 2017 compared
to $14.03 per BOE in the first quarter of 2017. This decrease
on a per unit basis compared to the first quarter of 2017 was
primarily due to the implementation of cost reduction strategies by
the operators of our wells. The Company expects to continue
realizing the positive effects of cost reduction strategies going
forward. General and administrative expenses for the second quarter
of 2017 were $1.0 million compared to $1.3 million for the same
first quarter in 2017. The quarter over quarter decrease is
primarily associated with a reduction in professional fees
associated with the assignement and transfer of the Company’s
Credit Facility.
Adjusted EBITDA was $0.4 million for the second
quarter of 2017, as compared to $(0.5) million for the first
quarter of 2017. Net Income (Loss) was $0.3 million for the
second quarter of 2017 compared to $(0.7) million for the
first quarter of 2017. Adjusted EBITDA is a non-GAAP
financial measure. For additional information please refer to
the reconciliation of this measure at the end of this news
release.
Credit Facility Update
On May 2, 2017, the Credit Facility between the
Company’s wholly owned subsidiary, Energy One and Wells Fargo Bank
N.A. was sold, assigned and transferred to APEG Energy II, L.P.
(“APEG”). On June 28, 2017, the Company and APEG entered into
the Fifth Amendment to the Credit Agreement providing for, among
other things, an extension of the maturity date to July 19, 2019,
new financial coverage ratio covenants and a limited release and
waiver with respect to any historical Company non-compliance with
any and all financial covenants. As of June 30, 2017, the Company
was in compliance with all financial covenants and fully confirming
with all requirements under its credit facility. Accordingly, the
entire outstanding balance under the Credit Facilty of $6.0 million
has been classified as a long-term liability.
Credit Facililty
Covenants |
|
Required Covenant Ratio |
|
U.S.
Energy at 6/30/2017* |
Current
Ratio |
|
Greater
than 1.0 to 1.0 |
|
5.6 to
1.0 |
PDP to Secured
Debt |
|
Greater
than 1.2 to 1.0 |
|
2.3 to
1.0 |
*Represents amounts subject to calculation per
Credit Agreement amendment
Update to Hedging Activity
Crude oil price swaps were entered into during
the second quarter of 2017 for the remainder of the year. On July
26, 2017, the Company entered into natural gas price swaps for the
entirety of 2018. An overview of outstanding Company hedges
is summarized below:
|
|
Begin |
|
|
End |
|
|
Quantity
(bbls/d) |
|
|
Price |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Crude oil price swaps
|
|
|
7/1/17 |
|
|
|
12/31/17 |
|
|
|
300 |
|
|
$ |
52.40 |
|
|
|
Begin |
|
|
End |
|
|
Quantity (mcf/d) |
|
|
Price |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas price swaps
|
|
|
1/1/18 |
|
|
|
12/31/18 |
|
|
|
500 |
|
|
$ |
3.01 |
|
Management Comment
David Veltri, U.S. Energy’s Chief Executive
Officer, stated, “U.S. Energy posted its strongest quarter since
the beginning of the global commodity price decline.
Production increased 17% quarter over quarter while LOE per barrel
decreased 35% over the same time period. These highly
positive outcomes are a direct result of the U.S. Energy team
working with the operators of its wells to maximize cash flow from
operations through optimizing existing production while remaining
focused on implementing cost reduction strategies. We anticipate
additional consolidation efforts and acreage trades involving our
North Dakota Assets along with upcoming development opportunities
on our South Texas projects in the near future.”
Mr. Veltri added, “U.S. Energy is also pleased
to be working with its new strategic partner and existing lender,
APEG Energy II and its parent, Angelus Capital. Our mutual goal is
to position ourselves to capitalize on the significant growth and
consolidation opportunities we are currently seeing in the market
and expect to see more of going forward. The Company will continue
to focus on accretive capital allocation, growing reserves and
increasing production to help prepare us for future opportunities
and value creation for all shareholders.”
About U.S. Energy Corp.
We are an independent energy company focused on
the lease acquisition and development of oil and gas producing
properties in the continental United States. Our business is
currently focused in the Williston Basin of North Dakota and South
Texas. We continue to focus on increasing production, reserves, and
cash flow from operations while pro-actively managing our debt
levels. More information about U.S. Energy Corp. can be found at
www.usnrg.com.
Forward-Looking Statements
This press release may include “forward-looking
statements” within the meaning of the securities laws. All
statements other than statements of historical facts included
herein may constitute forward-looking statements. Forward-looking
statements in this document may include statements regarding the
Company’s expectations regarding the Company’s operational,
exploration and development plans; expectations regarding the
nature and amount of the Company’s reserves; and expectations
regarding production, revenues, cash flows and recoveries. When
used in this press release, the words "will," "potential,"
"believe," "estimate," "intend," "expect," "may," "should,"
"anticipate," "could," "plan," "predict," "project," "profile,"
"model," or their negatives, other similar expressions or the
statements that include those words, are intended to identify
forward-looking statements, although not all forward-looking
statements contain such identifying words. Such statements are
subject to a number of assumptions, risks and uncertainties, many
of which are beyond the control of the Company, which may cause
actual results to differ materially from those implied or expressed
by the forward-looking statements. Factors that could cause or
contribute to such differences include, but are not limited to,
fluctuations in oil and natural gas prices, uncertainties inherent
in estimating quantities of oil and natural gas reserves and
projecting future rates of production and timing of development
activities, competition, operating risks, acquisition risks,
liquidity and capital requirements, the effects of governmental
regulation, adverse changes in the market for the Company’s oil and
natural gas production, dependence upon third-party vendors, and
other risks detailed in the Company’s periodic report filings with
the Securities and Exchange Commission.
U.S. ENERGY CORP. CONDENSED CONSOLIDATED
BALANCE SHEETS(Unaudited) |
|
|
|
|
|
June 30, 2017
|
|
|
|
|
December 31, 2016 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and
equivalents |
|
$ |
1,987 |
|
|
|
$ |
2,518 |
|
Oil and
gas sales receivable |
|
|
641 |
|
|
|
|
562 |
|
Discontinued operations - assets of mining segment |
|
|
114 |
|
|
|
|
114 |
|
Assets
available for sale |
|
|
653 |
|
|
|
|
653 |
|
Marketable securities |
|
|
622 |
|
|
|
|
946 |
|
Oil price
risk derivatives |
|
|
311 |
|
|
|
|
- |
|
Other
current assets |
|
|
233 |
|
|
|
|
96 |
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
4,561 |
|
|
|
|
4,889 |
|
|
|
|
|
|
|
|
|
|
Oil and gas
properties under full cost method: |
|
|
|
|
|
|
|
|
Unevaluated properties and exploratory wells in progress |
|
|
4,664 |
|
|
|
|
4,664 |
|
Evaluated
properties |
|
|
87,919 |
|
|
|
|
87,834 |
|
Less
accumulated depreciation, depletion and amortization |
|
|
(83,094 |
) |
|
|
|
(82,640 |
) |
|
|
|
|
|
|
|
|
|
Net oil and gas properties |
|
|
9,489 |
|
|
|
|
9,858 |
|
|
|
|
|
|
|
|
|
|
Other
assets: |
|
|
|
|
|
|
|
|
Property
and equipment, net |
|
|
1,650 |
|
|
|
|
1,864 |
|
Other
assets |
|
|
108 |
|
|
|
|
156 |
|
|
|
|
|
|
|
|
|
|
Total other assets |
|
|
1,758 |
|
|
|
|
2,020 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
15,808 |
|
|
|
$ |
16,767 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities: |
|
|
|
|
|
|
|
|
Payable
to major operator |
|
$ |
2,667 |
|
|
|
$ |
2,710 |
|
Contingent ownership interests |
|
|
1,518 |
|
|
|
|
1,430 |
|
Other |
|
|
748 |
|
|
|
|
743 |
|
Accrued
compensation and benefits |
|
|
63 |
|
|
|
|
49 |
|
Current
portion of long-term debt |
|
|
- |
|
|
|
|
6,000 |
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
4,996 |
|
|
|
|
10,932 |
|
|
|
|
|
|
|
|
|
|
Noncurrent
liabilities: |
|
|
|
|
|
|
|
|
Revolving
credit facility |
|
|
6,000 |
|
|
|
|
- |
|
Asset
retirement obligations |
|
|
1,061 |
|
|
|
|
1,045 |
|
Warrant
liability |
|
|
510 |
|
|
|
|
1,030 |
|
Other
liabilities |
|
|
- |
|
|
|
|
2 |
|
Total noncurrent liabilities |
|
|
7,571 |
|
|
|
|
2,077 |
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies (Note 7) |
|
|
|
|
|
|
|
|
Shareholders'
equity: |
|
|
|
|
|
|
|
|
Preferred
stock, par value $0.01 per share. Authorized 100,000 shares,
50,000 shares of series A Convertible Preferred Stock
outstanding as of June 30, 2017 and
December 31, 2016; liquidation preference of $2,375 as
of June 30, 2017. |
|
|
1 |
|
|
|
|
1 |
|
Common
stock, $0.01 par value; unlimited shares authorized;
6,134,506 and 5,834,568 shares issued and outstanding,
respectively |
|
|
61 |
|
|
|
|
61 |
|
Additional paid-in capital |
|
|
127,787 |
|
|
|
|
127,576 |
|
Accumulated deficit |
|
|
(124,229 |
) |
|
|
|
(123,825 |
) |
Other
comprehensive loss |
|
|
(379 |
) |
|
|
|
(55 |
) |
|
|
|
|
|
|
|
|
|
Total shareholders' equity |
|
|
3,241 |
|
|
|
|
3,758 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders' equity |
|
$ |
15,808 |
|
|
|
$ |
16,767 |
|
U.S. ENERGY CORP. CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS(Unaudited) |
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
June 30: |
|
|
June 30: |
|
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil |
|
$ |
1,591 |
|
|
$ |
1,677 |
|
|
|
$ |
2,830 |
|
|
$ |
2,541 |
|
Natural
gas and liquids |
|
|
401 |
|
|
|
319 |
|
|
|
|
909 |
|
|
|
521 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue |
|
|
1,992 |
|
|
|
1,996 |
|
|
|
|
3,739 |
|
|
|
3,062 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil and
gas operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production costs |
|
|
803 |
|
|
|
1,434 |
|
|
|
|
1,856 |
|
|
|
2,464 |
|
Depreciation, depletion and amortization |
|
|
202 |
|
|
|
864 |
|
|
|
|
473 |
|
|
|
1,646 |
|
Impairment of oil and gas properties |
|
|
- |
|
|
|
2,611 |
|
|
|
|
- |
|
|
|
9,568 |
|
General
and administrative: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits, including directorand contract
employees |
|
|
178 |
|
|
|
172 |
|
|
|
|
354 |
|
|
|
311 |
|
Stock-based compensation |
|
|
106 |
|
|
|
34 |
|
|
|
|
212 |
|
|
|
68 |
|
Professional services |
|
|
571 |
|
|
|
541 |
|
|
|
|
1,350 |
|
|
|
768 |
|
Insurance, rent and other |
|
|
136 |
|
|
|
16 |
|
|
|
|
237 |
|
|
|
183 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
operating expenses |
|
|
1,996 |
|
|
|
5,672 |
|
|
|
|
4,482 |
|
|
|
15,008 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
|
(4 |
) |
|
|
(3,676 |
) |
|
|
|
(743 |
) |
|
|
(11,946 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized
gain (loss) on oil price risk derivatives |
|
|
100 |
|
|
|
380 |
|
|
|
|
100 |
|
|
|
1,262 |
|
Unrealized gain (loss) on oil price risk derivatives |
|
|
311 |
|
|
|
(887 |
) |
|
|
|
311 |
|
|
|
(1,460 |
) |
Gain on
sale of assets |
|
|
1 |
|
|
|
100 |
|
|
|
|
1 |
|
|
|
100 |
|
Rental
and other income (loss) |
|
|
(131 |
) |
|
|
(48 |
) |
|
|
|
(347 |
) |
|
|
(79 |
) |
Warrant
fair value adjustment |
|
|
180 |
|
|
|
|
|
|
|
520 |
|
|
|
|
|
Interest
expense |
|
|
(121 |
) |
|
|
(75 |
) |
|
|
|
(246 |
) |
|
|
(247 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
other income (expense) |
|
|
340 |
|
|
|
(530 |
) |
|
|
|
339 |
|
|
|
(424 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
|
336 |
|
|
|
(4,206 |
) |
|
|
|
(404 |
) |
|
|
(12,370 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations |
|
|
- |
|
|
|
(10 |
) |
|
|
|
- |
|
|
|
(2,448 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
- |
|
|
|
(10 |
) |
|
|
|
- |
|
|
|
(2,448 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
|
336 |
|
|
|
(4,216 |
) |
|
|
|
(404 |
) |
|
|
(14,818 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
fair value of marketable equitysecurities |
|
|
(238 |
) |
|
|
927 |
|
|
|
|
(324 |
) |
|
|
927 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive profit (loss) |
|
$ |
98 |
|
|
$ |
(3,289 |
) |
|
|
$ |
(728 |
) |
|
$ |
(13,891 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss)
from continuing operations applicableto common
shareholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
(loss) from continuing operations |
|
$ |
98 |
|
|
$ |
(4,206 |
) |
|
|
$ |
(728 |
) |
|
$ |
(12,370 |
) |
Accrued
dividends related to Series A Convertible Preferred Stock
|
|
|
(71 |
) |
|
|
(62) |
|
|
|
|
(140 |
) |
|
|
(96 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) from continuing operationsapplicable to
common shareholders |
|
$ |
27 |
|
|
$ |
(4,268 |
) |
|
|
$ |
(868 |
) |
|
$ |
(12,466 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss)
per share- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
0.05 |
|
|
$ |
(0.90 |
) |
|
|
$ |
(0.09 |
) |
|
$ |
(2.63 |
) |
Discontinued operations |
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
|
(0.52 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
0.05 |
|
|
$ |
(0.90 |
) |
|
|
$ |
(0.09 |
) |
|
$ |
(3.15 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
0.05 |
|
|
$ |
(0.90 |
) |
|
|
$ |
(0.09 |
) |
|
$ |
(2.63 |
) |
Discontinued operations |
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
|
(0.52 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
0.05 |
|
|
$ |
(0.90 |
) |
|
|
$ |
(0.09 |
) |
|
$ |
(3.15 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
5,834,568 |
|
|
|
4,705,000 |
|
|
|
|
5,834,568 |
|
|
|
4,705,000 |
|
Diluted: |
|
|
6,626,344 |
|
|
|
4,705,000 |
|
|
|
|
5,834,568 |
|
|
|
4,705,000 |
|
|
|
U.S. ENERGY CORP. CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited) |
|
|
|
2017
|
|
|
2016 |
|
|
|
|
|
|
|
|
Cash flows from
operating activities: |
|
|
|
|
|
|
|
|
Net
loss |
|
$ |
(404 |
) |
|
|
$ |
(14,818 |
) |
Loss from
discontinued operations |
|
|
- |
|
|
|
|
2,448 |
|
Loss from
continuing operations |
|
|
(404 |
) |
|
|
|
(12,370 |
) |
Adjustments to reconcile loss from continuing operations to netcash
used in operating activities: |
|
|
|
|
|
|
|
|
Depreciation and depletion |
|
|
674 |
|
|
|
|
1,718 |
|
Debt
amortization |
|
|
27 |
|
|
|
|
|
|
Impairment of oil and gas properties |
|
|
- |
|
|
|
|
9,568 |
|
Change in
fair value of oil price risk derivative |
|
|
(311 |
) |
|
|
|
1,460 |
|
Stock-based compensation and services |
|
|
212 |
|
|
|
|
68 |
|
Warrant
fair value adjustment |
|
|
(520 |
) |
|
|
|
- |
|
Other |
|
|
(8 |
) |
|
|
|
52 |
|
Changes
in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Decrease
(increase) in: |
|
|
|
|
|
|
|
|
Oil and
gas sales receivable |
|
|
(79 |
) |
|
|
|
309 |
|
Other
assets |
|
|
(138 |
) |
|
|
|
(160 |
) |
Increase
(decrease) in: |
|
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities |
|
|
- |
|
|
|
|
(948 |
) |
Accrued
compensation and benefits |
|
|
14 |
|
|
|
|
(1,131 |
) |
|
|
|
|
|
|
|
|
|
|
Net cash
used in operating activities |
|
|
(533 |
) |
|
|
|
(1,434 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
|
|
|
Capital
expenditures |
|
|
(22 |
) |
|
|
|
(86 |
) |
Proceeds from asset sale |
|
|
24 |
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
Net cash
used in investing activities: |
|
|
2 |
|
|
|
|
(86 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
|
|
|
|
Proceeds
from issuance of preferred stock |
|
|
- |
|
|
|
|
1 |
|
Payments
for debt issuance costs |
|
|
- |
|
|
|
|
(24 |
) |
Cash
payment for fractional shares in reverse stock split |
|
|
- |
|
|
|
|
(3 |
) |
|
|
|
- |
|
|
|
|
|
|
Net cash
provided by financing activities |
|
|
- |
|
|
|
|
(26 |
) |
|
|
|
|
|
|
|
|
|
Discontinued
operations: |
|
|
|
|
|
|
|
|
Net cash
used in discontinued operations |
|
|
- |
|
|
|
|
(448 |
) |
|
|
|
|
|
|
|
|
|
|
Net
decrease in cash and equivalents |
|
|
(531 |
) |
|
|
|
(1,994 |
) |
|
|
|
|
|
|
|
|
|
Cash and equivalents,
beginning of period |
|
|
2,518 |
|
|
|
|
3,354 |
|
|
|
|
|
|
|
|
|
|
|
Cash and equivalents,
end of period |
|
$ |
1,987 |
|
|
|
$ |
1,360 |
|
|
|
|
|
|
|
|
|
|
|
Non-cash
investing and financing activities: |
|
|
|
|
|
|
|
|
Issuance of preferred
stock in disposition of mining segment |
|
|
- |
|
|
|
$ |
1,999 |
|
|
|
|
|
|
|
|
|
|
|
Elimination of asset
retirement obligations in disposition ofmining segment |
|
|
|
|
|
|
|
204 |
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain on
marketable equity securities |
|
|
|
|
|
|
|
927 |
|
|
|
|
|
|
|
|
|
|
|
Net additions to oil
and gas properties through asset retirementobligations |
|
|
- |
|
|
|
|
1 |
|
|
|
|
|
|
|
|
|
|
|
In addition to reporting net income (loss) as defined under
GAAP, we also present net earnings before interest, income taxes,
depletion, depreciation, and amortization, accretion of discount on
asset retirement obligations, impairment of oil and natural gas
properties, warrant revaluation (gains) and expenses, net gain
(loss) from mark-to-market on commodity derivatives, cash
settlements received (paid), standby rig expenses and non-cash
expenses relating to share based payments recognized under ASC
Topic 718 (“Adjusted EBITDA”), which is a non-GAAP performance
measure. Adjusted EBITDA consists of net earnings after adjustment
for those items described in the table below. Adjusted EBITDA does
not represent, and should not be considered an alternative to GAAP
measurements, such as net income (loss) (its most directly
comparable GAAP measure), and our calculations thereof may not be
comparable to similarly titled measures reported by other
companies. By eliminating the items described below, we believe the
measure is useful in evaluating its fundamental core operating
performance. We also believe that Adjusted EBITDA is useful to
investors because similar measures are frequently used by
securities analysts, investors, and other interested parties in
their evaluation of companies in similar industries. Our management
uses Adjusted EBITDA to manage our business, including in preparing
our annual operating budget and financial projections. Our
management does not view Adjusted EBITDA in isolation and also uses
other measurements, such as net income (loss) and revenues to
measure operating performance. The following table provides a
reconciliation of net loss to Adjusted EBITDA for the periods
presented:
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
2017 |
|
|
2016 |
|
|
2017
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations(GAAP) |
|
$ |
336 |
|
|
$ |
(4,206 |
) |
|
$ |
(404 |
) |
|
|
$ |
(12,370 |
) |
Impairment of oil and
gas properties |
|
|
- |
|
|
|
2,611 |
|
|
|
- |
|
|
|
|
9,568 |
|
Depreciation, depletion
and amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil and
gas operations |
|
|
202 |
|
|
|
864 |
|
|
|
473 |
|
|
|
|
1,646 |
|
Other |
|
|
|
|
|
|
36 |
|
|
|
|
|
|
|
72 |
|
Unrealized (gain) loss
on oil price risk derivatives |
|
|
(311 |
) |
|
|
887 |
|
|
|
(311 |
) |
|
|
|
1,460 |
|
Stock-based
compensation |
|
|
106 |
|
|
|
34 |
|
|
|
212 |
|
|
|
|
68 |
|
Gain on sale of
assets |
|
|
(1 |
) |
|
|
(100 |
) |
|
|
(1 |
) |
|
|
|
100 |
|
Rental and other income
(expense), net |
|
|
131 |
|
|
|
48 |
|
|
|
347 |
|
|
|
|
79 |
|
Warrant Fair Value
Adjustment (gain) loss |
|
|
(180 |
) |
|
|
|
|
|
|
(520 |
) |
|
|
|
|
|
Interest expense |
|
|
121 |
|
|
|
69 |
|
|
|
246 |
|
|
|
|
247 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDAX (Non-GAAP) |
|
$ |
404 |
|
|
$ |
243 |
|
|
$ |
42 |
|
|
|
$ |
870 |
|
Corporate Contact:
U.S. Energy Corp.
Ryan Smith
Chief Financial Officer
(303) 993-3200
www.usnrg.com
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