Tengasco Announces Second Quarter 2006 Financial Results and Continuing Record Production Volumes and Profits
August 11 2006 - 10:57AM
Business Wire
Tengasco, Inc. (AMEX:TGC) announced today its financial results for
the quarter ended June 30, 2006. The Company realized a net income
attributable to common shareholders of $720,769 or $0.01 per share
of common stock during the second quarter of 2006, compared to a
net loss in the second quarter of 2005 to common shareholders of
($132,540) or ($0.00) per share of common stock. The Company
recognized $2,354,736 in total revenues from its Kansas and
Tennessee properties during the second quarter of 2006 compared to
$1,612,097 in the second quarter of 2005. The Company increased
production by 8,229 barrels allocable to the Company's interest in
the second quarter of 2006 over 2005 levels. This increased
production volume created approximately 56% of the Company's total
revenue increase, with the remaining 44% of the total revenue
increase being attributable to higher oil prices in 2006. Oil
prices in the second quarter of 2006 averaged $64.92 per barrel as
compared to $50.29 per barrel in the second quarter of 2005. The
Company recognized $4,453,705 in total revenues from its Kansas and
Tennessee properties during the first six months of 2006 compared
to $3,043,115 in the first six months of 2005. Approximately half
of this increase in revenues was due to a 14,590 barrel increase
allocable to the Company's interest in oil production from the
Kansas field, with the remaining portion of the revenue increase
being attributable to an increase in oil prices in 2006. The Kansas
oil production increase is attributable to well workovers, polymer
completion workovers, and the Company's ownership interest in the
Kansas drilling program wells. Oil prices in the first six months
of 2006 averaged $61.92 per barrel as compared to $49.10 per barrel
in the first six months of 2005. Jeffrey R. Bailey, Chief Executive
Officer, said, "We are extremely pleased with the continuing
pattern of the Company's record production levels, increasing
revenues, and record profits. Our second quarter 2006 revenues were
46% higher than the second quarter 2005 revenues. In addition, our
second quarter 2006 revenues were 12% higher than in the first
quarter in 2006. In the second quarter 2006 we had a net cash flow
of $1,154,068 which is also the highest quarterly net cash flow
result in the history of the Company. More than half of this record
net cash flow and Company revenues have been the result of our
higher production volumes and not simply from higher prices. We
produced in the second quarter 2006 a Company-record quarterly
volume of 46,011 barrels of oil, 44,242 barrels of which were
produced in Kansas. As a result, the Company made an all-time
Company-record 31% profit in the second quarter 2006. This is the
fourth consecutive quarter in which the Company has shown a profit,
also a first for the Company." Mr. Bailey continued, "In the recent
past the Company has used increased production together with higher
prices to completely rework the Company's balance sheets. Our
successful track record since February 2004 in doing this has
helped the Company to close a senior credit facility with Citibank
Texas, N.A. in June 2006, and in doing so meeting a primary Company
goal of establishing a commercial banking relationship. This
completes the turnaround targeted by the Company in early 2004: the
Company has gone from total liabilities as of December 31, 2003 of
about $19.4 million to approximately $3.2 million as of June 30,
2006, which includes the loan obligation to Citibank Texas, an
established energy lender that will serve the Company as it
continues to grow. We look forward to building on these successes
in the future, while continuing development of our existing
properties, and seeking out new opportunities and acquisitions."
The Company also announced that Tengasco was added to the Russell
Microcap(TM) Index when Russell Investment Group reconstituted its
family of U.S. indexes on June 30, 2006. Russell indexes are used
by investment managers and institutional investors for index funds
and as benchmarks for both passive and active investment
strategies. Forward-looking statements made in this release are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Investors are cautioned
that all forward-looking statements involve risk and uncertainties
which may cause actual results to differ from anticipated results,
including risks associated with the timing and development of the
Company's reserves and projects as well as risks of downturns in
economic conditions generally, and other risks detailed from time
to time in the Company's filings with the Securities and Exchange
Commission.
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