Mart Announces Financial and Operating Results for the Six Months Ended June 30, 2010
August 26 2010 - 8:30AM
Marketwired Canada
Mart Resources, Inc. (TSX VENTURE:MMT) ("Mart" or the "Company") is pleased to
announce its 2010 half year financial and operating results (all amounts shown
in Canadian dollars unless noted):
HIGHLIGHTS - SIX MONTHS ENDED JUNE 30, 2010
-- Net operating income for the six months ended June 30, 2010 of $12.5
million, with net and comprehensive income after taxes of $2.5 million,
compared to a loss of $2.2 million for the six months ended June 30,
2009.
-- Cash flow from operations of $11.8 million for the six months ended June
30, 2010 compared to $2.9 million for the six months ended June 30,
2009.
-- Total revenues of $34.8 million for the six months ended June 30, 2010
compared to $29.9 million for the six months ended June 30, 2009.
-- Total liabilities (including $7.3 million of bank debt) of $28.6 million
at June 30, 2010, compared to total liabilities of $38.0 million at
December 31, 2009 and $57.1 million at June 30, 2009.
-- Bank debt reduced to $7.3 million at June 30, 2009 compared to $13.3
million at December 31, 2009 and $27.1 million at June 30, 2009.
-- Average Umusadege field oil production for second quarter ended June 30,
2010 ("Q210") of 3,682 barrels of oil per day ("bopd") compared to 3,533
bopd for the second quarter ended June 30, 2009 ("Q209").
FINANCIAL AND OPERATING RESULTS
The following table provides a summary of Mart's selected financial and
operating results for the six months ended June 30, 2010 and for the years ended
December 31, 2009 and 2008. Unaudited interim financial statements for the
period ended June 30, 2010 along with Management's Discussion and Analysis
("MD&A") are available on the Company's website at www.martresources.com and
will also be available on the SEDAR website at www.sedar.com.
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(CDN$) 12 months ended 12 months ended
6 months ended December 31, December 31,
June 30, 2010 2009 2008
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Crude oil revenue after
royalties $ 33,666,384 $ 72,605,726 $ 42,859,035
Funds flow from
operations (1) 30,056,173 55,485,284 24,408,078
Funds flow from
operations per share -
basic 0.09 0.17 0.08
Income (loss) from
operations 12,528,657 10,321,575 (21,586,870)
Per share - basic 0.04 0.03 (0.07)
Net earnings (loss) 2,472,153 (26,285,610) (21,586,870)
Per share - basic 0.01 (0.08) (0.07)
Total assets 76,372,372 82,143,164 121,748,865
Net debt (1) 16,415,138 28,600,869 50,460,562
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Shares outstanding - end
of period - basic 335,548,201 335,548,201 320,792,651
Note:
(1) Indicates non-GAAP measures. Non-GAAP measures are informative measures
commonly used in the oil and gas industry. Such measures do not conform to
Canadian generally accepted accounting principles and may not be comparable to
those reported by other companies nor should they be viewed as an alternative to
other measures of financial performance calculated in accordance with GAAP. For
the purposes of this table, the Corporation defines "Funds flow from operations"
as net crude oil sales less production costs, and defines Net debt as the total
of all bank debt and accounts payable.
CORPORATE AND OPERATIONS REVIEW
The Umusadege field development will begin with the drilling of the UMU-6 well
with anticipated drilling operations to commence during the week of August 30,
2010. Site preparation at the UMU-6 drilling location has been completed and the
NRG drilling Rig 201 has been mobilized to the UMU-6 site and rig-up is
currently nearing completion. The UMU-6 well is scheduled to be drilled as a
vertical well to a depth of approximately 9,000 feet. It is anticipated that the
UMU-6 well will be completed with a dual tubing string configuration allowing
for the potential of multiple zones to be produced in the well bore. The UMU-6
well primary objectives are the XIII, XIV, XV and XVI sands which have not been
produced or production tested to date. It is anticipated that the UMU-6 well
will take approximately 30 days to drill after commencement of drilling
operations.
Current Umusadege field production is averaging approximately 3,878 bopd from
the UMU-1 and UMU-5 wells.
ABOUT MART RESOURCES:
Mart Resources Inc. is an independent, international petroleum company focused
on drilling, developing and producing oil and gas from low-risk proven petroleum
properties in Nigeria, West Africa. The Company is currently producing and
developing the Umusadege field with Midwestern Oil and Gas Co. Plc. (Operator of
the Umusadege field) and SunTrust Oil Ltd. Mart also owns two land drilling
rigs, has strong local relationships and is evaluating additional proven
undeveloped opportunities in Nigeria.
Additional information regarding Mart Resources, Inc. is available on the
company's website at www.martresources.com.
Non-GAAP Measures
This press release contains financial terms that are not considered measures
under Canadian generally accepted accounting principles ("GAAP"), such as funds
flow from operations, funds flow per share, net debt and operating netback.
These measures are commonly utilized in the oil and gas industry and are
considered informative for management and shareholders. Specifically, funds flow
from operations and funds flow per share reflect cash generated from operating
activities before changes in non-cash working capital. Management considers
funds flow from operations and funds flow per share important as they help
evaluate performance and demonstrate the Company's ability to generate
sufficient cash to fund future growth opportunities and repay debt. Net debt is
used to valuate financial leverage and includes bank debt plus the principal
amount of convertible debentures and accounts payable and accrued liabilities,
less current assets. Management considers operating netback important as it is a
measure of profitability per barrel of production. Funds flow from operations,
funds flow per share, net debt and operating netbacks may not be comparable to
those reported by other companies nor should they be viewed as an alternative to
cash flow from operations, net income or other measures of financial performance
calculated in accordance with GAAP.
Forward Looking Statements
Certain statements contained in this press release constitute "forward-looking
statements" as such term is used in applicable Canadian and US securities laws.
These statements relate to analyses and other information that are based upon
forecasts of future results, estimates of amounts not yet determinable and
assumptions of management. In particular, statements concerning the timing of
the drilling of the UMU-6 well, the future success of such well, the ability of
the Company to successfully complete and commercially produce, transport and
sell oil from such well, the maintenance of current production levels from
existing wells, future crude oil pricing levels and the ability to of the
Company to fund future drilling operations (including the drilling of the Umu-6
well) from future cash flow and events or projections referenced or implied
herein should be viewed as forward-looking statements.
Any statements that express or involve discussions with respect to predictions,
expectations, beliefs, plans, projections, objectives, assumptions or future
events or are not statements of historical fact and should be viewed as
"forward-looking statements". Such forward looking statements involve known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Corporation to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such risks and other factors
include, among others, costs and timing of exploration and production
development, availability of capital to fund exploration and production
development; political, social and other risks inherent in carrying on business
in a foreign jurisdiction, the effects of a recessionary economy and such other
business risks as discussed herein and other publicly filed disclosure
documents. Although the Company has attempted to identify important factors that
could cause actual actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or intended.
Investors are cautioned that such forward-looking statements involve risks and
uncertainties. There can be no assurance that such statements will prove to be
accurate as actual results and future events could vary or differ materially
from those anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking statements contained in this news release. The
forward-looking statements contained herein are expressly qualified by this
cautionary statement.
Forward-looking statements are made based on management's beliefs, estimates and
opinions on the date the statements are made and the Company undertakes no
obligation to update forward-looking statements and if these beliefs, estimates
and opinions or other circumstances should change, except as required by
applicable law.
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