ReoStar Energy Corp. (OTCBB: REOS) today announced results of
operations for the second quarter of Fiscal Year 2010.
Second Quarter Fiscal Year 2010 Financial and Production
Summary
Oil sales during the quarter ended September 30, 2009, totaled
approximately 5,081 barrels, compared with approximately 11,565
barrels of oil for the quarter ended September 30, 2008. The
average price received for oil sold during the quarter ended
September 30, 2009 declined 45% to $64.16 per barrel, when compared
with an average price for the quarter ended September 30, 2008 of
$115.90 per barrel.
Natural gas sales during the quarter ended September 30, 2009
approximated 100,077 thousand cubic feet (Mcf), compared with
approximately 124,300 Mcf of gas sales in the same period a year
earlier. The price received for natural gas sold during the quarter
ended September 30, 2009 averaged $2.23 per Mcf (net of
transportation, compression and CO2 charges), compared with $7.57
per Mcf in the quarter ended September 30, 2009, a decrease of
approximately 70%.
Oil and gas revenues for the three months ended September 30,
2009 totaled $556,141, compared with $2,282,048 in the quarter
ended September 30, 2008. The primary reasons for the decrease in
revenue were lower production and lower average sales prices in the
second quarter of 2010 versus the same period the prior year.
On September 30, 2009, the Company had $105,000 in cash, and
total assets approximated $22.9 million. Liabilities consisted of
accounts and notes payable to non-related parties of $11 million,
of which $10.8 million was long-term. The Company also had accounts
and notes payable to related parties of $3.6 million.
During the quarter, the Company did not draw on the credit
facility secured by its assets. The material terms of the credit
facility were reported in the Company's Form 8-K filed on November
4, 2008. The remaining credit available under the credit facility
as of September 30, 2008 approximated $3.2 million.
Mark Zouvas, CEO of ReoStar, commented, "There are a number of
challenges we face during the remainder of the fiscal year.
Although we are disappointed with our second quarter results, much
of the production and revenue decline reflected our conservative
approach to managing cash reserves and slowing our drilling
expansion. We are comfortable with our financial outlook for the
remainder of Fiscal 2010, as we proceed with caution in our
expansion plans while remaining astute in managing budgets and
adjusting to uncertain industry and economic conditions. We
continue to seek strategic opportunities and valuable 'bolt-on'
acreage in our respective target areas, but we will remain
conservative with capital expenditures until management considers
it strategically appropriate to deploy our resources."
About ReoStar Energy Corporation
ReoStar Energy Corporation (OTCBB: REOS), headquartered in Fort
Worth, Texas, is an oil and gas company engaged in the acquisition,
development and production of natural gas and oil properties, with
operations primarily focused on developmental resource plays and
enhanced oil recovery projects. The Company has vertically
integrated its assets to remove potential obstacles to growth and
enable it to develop and produce assets without the risk, cost and
time involved in traditional exploration.
The Company's strategy is to cost effectively acquire an
attractive portfolio of oil reserves that have a high ratio of
possible, probable or proven undeveloped reserves. By converting
undeveloped reserves into proved producing reserves, the Company
seeks to realize an increase in overall value at low risk and
cost.
The Company's assets include approximately 9,500 gross mineral
leasehold acres located in Texas (Barnett & Corsicana).
ReoStar's assemblage of E&P assets allows for appreciable,
unimpeded growth into the foreseeable future.
Additional information is located on the company's website:
www.reostarenergy.com.
Certain statements in this news release may contain
forward-looking information within the meaning of Rule 175 under
the Securities Act of 1933 and Rule 3b-6 under the Securities
Exchange Act of 1934, and are subject to the safe harbor created by
those rules. All statements, other than statements of fact,
included in this release, including, without limitation, statements
regarding potential future plans and objectives of the company, are
forward-looking statements that involve risks and uncertainties.
There can be no assurance that such statements will prove to be
accurate and actual results and future events could differ
materially from those anticipated in such statements. Technical
complications which may arise could prevent the prompt
implementation of any strategically significant plan(s) outlined
above.
ReoStar Energy Corporation
Consolidated Balance Sheets
September 30, March 31,
2009 2009
(unaudited)
ASSETS
Current Assets:
Cash $ 105,457 $ 426,430
Accounts Receivable:
Oil & Gas - Related Party 382,987 337,879
Related Party 773,219 1,107,854
Other 41,554 15,760
Inventory 2,445 7,514
Hedging Account 6,317 6,317
------------ ------------
Total Current Assets 1,311,979 1,901,754
------------ ------------
Note Receivable 553,536 553,536
------------ ------------
Oil and Gas Properties - successful efforts
method 26,316,823 25,254,777
Less Accumulated Depletion and Depreciation (7,328,208) (6,206,558)
------------ ------------
Oil & Gas Properties (net) 18,988,615 19,048,219
------------ ------------
Other Depreciable Assets: 2,322,167 2,171,654
Less Accumulated Depreciation (425,303) (315,093)
------------ ------------
Other Depreciable Assets (net) 1,896,864 1,856,561
------------ ------------
Leasehold Held for Sale 150,000 150,000
------------ ------------
Total Assets $ 22,900,994 $ 23,510,070
============ ============
LIABILITIES
Current Liabilities:
Accounts Payable $ 59,466 $ 22,033
Payable to Related Parties 29,812 148,550
Accrued Expenses 132,902 106,141
Accrued Expenses - Related Party 109,664 130,870
Hedging Liabilities - Current 120,869
------------ ------------
Total Current Liabilities 452,713 407,594
------------ ------------
Notes Payable 10,119,270 8,955,202
Notes Payable - Related Parties 3,518,924 3,518,924
------------ ------------
Total Long-Term Debt 13,638,194 12,474,126
------------ ------------
Asset Retirement Obligation 387,353 344,079
Hedging Liability - Noncurrent 25,056 -
Deferred Tax Liability 1,010,794 1,702,782
------------ ------------
Total Liabilities 15,514,110 14,928,581
------------ ------------
Commitments & Contingencies: - -
------------ ------------
Stockholders' Equity
Common Stock, $.001 par, 200,000,000 shares
authorized and 81,643,912 shares outstanding
on September 30, 2009 and 80,353,912 shares
outstanding on March 31, 2009 81,643 80,353
Additional Paid-In-Capital 11,685,345 10,959,965
Retained Deficit (4,380,104) (2,458,829)
------------ ------------
Total Stockholders' Equity 7,386,884 8,581,489
------------ ------------
Total Liabilities & Stockholders' Equity $ 22,900,994 $ 23,510,070
============ ============
ReoStar Energy Corporation
Consolidated Statements of Operations
Three Months Ended
--------------------------
September 30, September 30,
2009 2008
(unaudited) (unaudited)
------------ ------------
Revenues
Oil & Gas Sales $ 556,141 $ 2,282,048
Sale of Leases 137,677 18,005
Other Income 90,119 109,568
------------ ------------
783,937 2,409,621
------------ ------------
Costs and Expenses
Oil & Gas Lease Operating Expenses 515,195 789,234
Workover Expenses 43,998 87,982
Severance & Ad Valorem Taxes 31,129 132,125
Depletion & Depreciation 684,361 381,660
ARO Accretion 11,031 -
General & Administrative:
Salaries & Benefits 201,935 135,068
Legal & Professional 648,979 193,129
Other General & Administrative 126,406 40,295
Interest, net of capitalized interest of
$132,375 and $151,343 for the three months
ended 9/30/09 and 9/30/08, respectively and
$254,273 and $312,919 for the six months
ended 9/30/09 and 9/30/08, respectively - 2,900
------------ ------------
2,263,034 1,762,393
------------ ------------
Other Income (Expense)
Interest Income 13,934 40
Loss on Equity Method Investments (142,395)
Hedging Gain (Loss) (103,643) (93)
------------ ------------
Income (Loss) from continuing operations
Before income taxes (1,568,806) 504,780
------------ ------------
Income Tax Benefit (Expense) 351,944 (211,323)
------------ ------------
Net Income (Loss) $ (1,216,862) $ 293,457
============ ============
Basic & Diluted Loss per Common Share $ (0.02) $ 0.00
------------ ------------
Weighted Average Common Shares Outstanding 80,998,912 80,181,310
============ ============
Contact: ReoStar Energy Corporation Teresa Wright
817-546-7718
ReoStar Energy (PK) (USOTC:REOS)
Historical Stock Chart
From Dec 2024 to Jan 2025
ReoStar Energy (PK) (USOTC:REOS)
Historical Stock Chart
From Jan 2024 to Jan 2025
