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EXHIBIT 99
April 9, 2015 SYNERGY RESOURCES CORPORATION
SYNERGY RESOURCES REPORTS FISCAL SECOND QUARTER 2015 RESULTS
Revenues of $23.7 Million generating Net Income of $0.05 per Share; Company to
Host Earnings Conference Call Today, April 9, 2015 at 12:00 p.m. ET 877-407-9122
Toll Free Dial-In, 201-493-6747 International/Local Dial-In
PLATTEVILLE, CO -- (Marketwired) -- 04/09/15 -- Synergy Resources Corporation
(NYSE MKT: SYRG), a U.S. oil and gas exploration and production company focused
in the Denver-Julesburg Basin, reported its fiscal second quarter results for
the period ended February 28, 2015.
Second Quarter 2015 Financial Results
o Revenues increased 3% to $23.7 million up from $23.0 million in the
same quarter a year ago. The year-over-year improvement was attributed
to a 98% increase in production, primarily from the new horizontal
wells brought on line and production from the Bayswater acquisition
that closed in December 2014. Revenue growth was offset by a 48%
decrease in the realized average selling price per BOE. During fiscal
Q2 2015, average selling prices were $43.51 per barrel of oil and
$3.38 per mcf of gas, as compared to $86.82 and $5.93, respectively a
year-ago.
o Net income was $4.7 million or $0.05 per basic and diluted share, down
from $5.2 million or $0.07 per basic and diluted share in the same
year-ago period.
o Adjusted EBITDA (a non-GAAP metric) increased 56% to $27.3 million up
from $17.5 million a year ago.
o At February 28, 2015, cash and cash equivalents totaled $218.5
million. Borrowings under the credit facility were $146.0 million with
remaining liquidity of $46.0 million on a borrowing base of $192.0
million.
Second Quarter 2015 Highlights
o Net oil and natural gas production increased to 697,069 barrels of oil
equivalent (BOE), averaging 7,745 BOE per day versus 3,917, as
compared to the same year- ago quarter, an average daily increase of
98%.
o Closed on the acquisition of the Bayswater assets located in the
Wattenberg Field on December 15, 2014.
o Raised approximately $191 million in net proceeds in an equity
offering at $10.75 per share that closed on February 2, 2015.
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o As of February 28, 2015, we were the operator of 39 gross producing
horizontal wells in the Wattenberg Field.
o 29 additional operated horizontal wells were awaiting completion and
11 more horizontal operated wells were in the drilling process as of
February 28, 2015.
The following tables present certain per unit metrics that compare results of
the corresponding quarterly reporting periods:
Three Months Ended
February 28,
-------------------------------
2015 2014 Change
-------------- --------------- --------
Production:
Oil (Bbls) 412,469 204,622 102%
Gas (Mcf) 1,707,598 887,494 92%
BOE 697,069 352,537 98%
Revenues (in thousands):
Oil $ 17,948 $ 17,765 1%
Gas 5,765 5,263 10%
--------- --------
Total $ 23,713 $ 23,028 3%
========= ========
Average realized price:
Oil $ 43.51 $ 86.82 -50%
Gas $ 3.38 $ 5.93 -43%
BOE $ 34.02 $ 65.32 -48%
"Bbl" refers to one stock tank barrel, or 42 U.S. gallons liquid volume in
reference to crude oil or other liquid hydrocarbons. "Mcf" refers to one
thousand cubic feet. A BOE (i.e. barrel of oil equivalent) combines Bbls of oil
and Mcf of gas by converting each six Mcf of gas to one Bbl of oil.
The following table summarizes operating costs on a per unit basis. Additional
details regarding operating costs can be found in the condensed financial
statements.
Costs per BOE Three Months Ended February 28,
2015 2014
---- ----
Lease operating expenses $ 5.29 $ 5.13
Production taxes $ 3.08 $ 6.40
DDA $ 22.24 $ 21.90
General and administrative $ 5.85 $ 5.02
------- -------
Total $ 36.46 $ 38.45
======= =======
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Monty Jennings, CFO of Synergy commented, "This quarter's financial results
reflect the benefits we are reaping from maintaining a keen eye on controlling
costs as we achieved a 63% operating cash margin on revenues in the quarter,
even while commodity prices were falling. Our financial EBITDA in the quarter
was greater than 100% of revenues as we realized over twelve million in cash
proceeds from monetizing commodity hedges that were entered into when prices for
oil ranged from $80 to $95 per barrel. At the same time, we nearly doubled our
production compared to the period a year ago as our shift to horizontal
development has been fully implemented. We further bolstered our balance sheet
during the quarter with nearly $191 million in net proceeds from our equity
offering. We have also added to our human resource capital with the hiring of
Brandon Lorenz as our Drilling Manager and Brant DeMuth as VP of Finance along
with key people in land, environmental, and accounting, all of which positions
the company well to manage its continued rapid growth."
Conference Call
The Company will hold a conference call on Thursday, April 9, 2015 at 12:00 p.m.
Eastern time to discuss results for its fiscal second quarter ended February 28,
2015.
Synergy Resources co-CEO Ed Holloway, co-CEO William Scaff, Jr., CFO Monty
Jennings, COO Craig Rasmuson and VP of Capital Markets and Investor Relations
Jon Kruljac will host the presentation, followed by a question and answer
period.
Date: Thursday, April 9, 2015
Time: 12:00 p.m. Eastern time (10:00 a.m. Mountain time)
877-407-9122 Toll Free Dial-In (US & Canada)
201-493-6747 International/Local Dial-In
The conference call will be webcast simultaneously which you can access via this
link: http://syrginfo.equisolvewebcast.com/q2-2015 and via the investor section
of the company's web site at www.syrginfo.com.
Please call the conference telephone number 5-10 minutes prior to the start
time. An operator will register your name and organization. If you have any
difficulty connecting with the conference call, contact Rhonda Sandquist with
Synergy Resources at 970-737-1073. A replay of the call will be available after
3:00 p.m. Eastern time on the same day and until April 23, 2015.
Replay Dial-In Numbers
877-660-6853 Toll Free (US & Canada)
201-612-7415 International/Local
Replay ID#411931
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About Synergy Resources Corporation
Synergy Resources Corporation is a domestic oil and natural gas exploration and
production company. Synergy's core area of operations is in the Denver-Julesburg
Basin, which encompasses Colorado, Wyoming, Kansas, and Nebraska. The Wattenberg
field in the D-J Basin ranks as one of the most productive fields in the U.S.
The company's corporate offices are located in Platteville, Colorado. More
company news and information about Synergy Resources is available at
www.syrginfo.com.
Important Cautions Regarding Forward Looking Statements
This press release may contain forward-looking statements, within the meaning of
the Private Securities Litigation Reform Act of 1995. The use of words such as
"believes", "expects", "anticipates", "intends", "plans", "estimates", "should",
"likely" or similar expressions, indicates a forward-looking statement. These
statements are subject to risk and uncertainties and are based on the beliefs
and assumptions of management, and information currently available to
management. The actual results could differ materially from a conclusion,
forecast or projection in the forward-looking information. Certain material
factors or assumptions were applied in drawing a conclusion or making a forecast
or projection as reflected in the forward-looking information. The
identification in this press release of factors that may affect the company's
future performance and the accuracy of forward-looking statements is meant to be
illustrative and by no means exhaustive. All forward-looking statements should
be evaluated with the understanding of their inherent uncertainty. Factors that
could cause the company's actual results to differ materially from those
expressed or implied by forward-looking statements include, but are not limited
to: the success of the company's exploration and development efforts; the price
of oil and gas; worldwide economic situation; change in interest rates or
inflation; willingness and ability of third parties to honor their contractual
commitments; the company's ability to raise additional capital, as it may be
affected by current conditions in the stock market and competition in the oil
and gas industry for risk capital; the company's capital costs, which may be
affected by delays or cost overruns; costs of production; environmental and
other regulations, as the same presently exist or may later be amended; the
company's ability to identify, finance and integrate any future acquisitions;
and the volatility of the company's stock price.
About Non-GAAP Financial Measures
The company uses "adjusted EBITDA," as a non-GAAP financial measure to evaluate
financial performance such as period-to-period comparisons. This Non-GAAP
measure is not defined under U.S. GAAP and should be considered in addition to,
not as a substitute for, indicators of financial performance reported in
accordance with U.S. GAAP. The company may use non-GAAP measures that are not
comparable to measures with similar titles reported by other companies. Also, in
the future, the company may disclose different non-GAAP financial measures in
order to help investors more meaningfully evaluate and compare the company's
future results of operations to its previously reported results. The company
encourages investors to review its financial statements and publicly-filed
reports in their entirety and not rely on any single financial measure. The
section titled "Reconciliation of Non-GAAP Financial Measures" includes a
detailed description of this measure as well as a reconciliation to its most
similar U.S. GAAP measure.
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Reconciliation of Non-GAAP Financial Measures
The company defines adjusted EBITDA as net income adjusted to exclude the impact
of interest expense, interest income, income taxes, depreciation, depletion and
amortization, stock based compensation, and the plus or minus change in fair
value of derivative assets or liabilities. The company believes adjusted EBITDA
is relevant because it is a measure of cash flow available to fund capital
expenditures and service debt and is a metric used by some industry analysts to
provide a comparison of its results with its peers. The following table presents
a reconciliation of the company's non-GAAP financial measures to the nearest
GAAP measure.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(unaudited, in thousands)
Three Months Ended Six Months Ended
February 28, February 28, February 28, February 28,
ADJUSTED EBITDA 2015 2014 2015 2014
Net income $ 4,652 $ 5,161 $ 25,803 $ 11,261
Depreciation, depletion,
and amortization 15,506 7,719 31,960 13,310
Income tax expense 3,207 2,338 14,951 5,725
Stock based compensation 1,136 448 1,929 867
Change in fair value -
derivatives 2,832 1,805 (13,876) (831)
Interest income (28) (17) (28) (48)
------- ------- -------- -------
Adjusted EBITDA $27,305 $17,454 $ 60,739 $30,284
======= ======= ======== =======
Financial Statements
Condensed financial statements are included below. Additional financial
information, including footnotes that are considered an integral part of the
financial statements, will be included in Synergy's Edgar Filings at www.sec.gov
on Form10-Q for the period ended February 28, 2015.
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SYNERGY RESOURCES CORPORATION
CONDENSED BALANCE SHEETS
(unaudited, in thousands)
February 28, August 31,
----------- ---------
2015 2014
ASSETS
Cash and short term investments $ 218,470 $ 34,753
Other current assets 51,093 33,487
--------- ---------
Total current assets 269,563 68,240
--------- ---------
Oil and gas properties and other equipment 552,511 379,400
Other assets 9,769 902
--------- ---------
Total assets $ 831,843 $ 448,542
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 77,280 103,578
Revolving credit facility 146,000 37,000
Asset retirement obligations 7,189 4,730
Commodity derivative - 307
Deferred tax liability, net 36,504 21,437
--------- ---------
Total liabilities 266,973 167,052
--------- ---------
Shareholders' equity:
Common stock and paid-in capital 523,448 265,871
Retained Earnings 41,422 15,619
--------- ---------
Total shareholders' equity 564,870 281,490
--------- ---------
Total liabilities and shareholders'
equity $ 831,843 $ 448,542
========== =========
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SYNERGY RESOURCES CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share data)
Three Months Ended Six Months Ended
February 28, February 28, February 28, February 28,
2015 2014 2015 2014
Oil and gas revenues $ 23,713 $ 23,028 $ 66,251 $ 42,294
--------- --------- --------- --------
Expenses:
Lease operating expenses 3,689 1,806 6,730 3,079
Production taxes 2,143 2,255 6,321 4,271
Depreciation, depletion,
and amortization 15,506 7,719 31,960 13,310
General and administrative 4,079 1,770 8,189 4,938
--------- --------- --------- --------
Total expenses 25,417 13,550 53,200 25,598
--------- --------- --------- --------
Operating income (1,704) 9,478 13,051 16,696
--------- --------- --------- --------
Other income (expense):
Commodity derivative
realized gain (loss) 12,367 (191) 13,799 (589)
Commodity derivative
unrealized gain (loss) (2,832) (1,805) 13,876 831
Interest income and
expense, net 28 17 28 48
--------- --------- --------- --------
Total other income
(expense) 9,563 (1,979) 27,703 290
--------- --------- --------- --------
Income tax provision 3,207 2,338 14,951 5,725
--------- --------- --------- --------
Net income $ 4,652 $ 5,161 $ 25,803 $ 11,261
========= ========= ========= ========
Net income per common share:
Basic $ 0.05 $ 0.07 $ 0.31 $ 0.15
========= ========= ========= ========
Diluted $ 0.05 $ 0.07 $ 0.30 $ 0.15
========= ========= ========= ========
Weighted average shares
outstanding:
Basic 89,903,288 76,203,938 84,396,143 74,934,940
========== ========== ========== ==========
Diluted 90,636,107 77,990,416 85,145,431 76,843,593
---------- ---------- ----------- ----------
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SYNERGY RESOURCES CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
----------------------------------
(unaudited, in thousands)
Six Months Ended
February 28, February 28,
2015 2014
Cash flows from operating activities:
Net income $ 25,803 $ 11,261
--------- --------
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion, and
amortization 31,960 13,310
Provision for deferred taxes 14,951 5,725
Other, non-cash items (11,947) 36
Changes in operating assets and
liabilities 4,348 3,022
--------- --------
Total adjustments 39,312 22,093
--------- --------
Net cash provided by operating
activities 65,115 33,354
--------- --------
Cash flows from investing activities:
Acquisition of property and equipment (197,530) (87,497)
Net proceeds from sales of oil and
gas properties 3,696
Net proceeds from short term investments - 39,990
--------- --------
Net cash used in investing activities (193,834) (47,507)
--------- --------
Cash flows from financing activities:
Proceeds from exercise of warrants 15,367 29,104
--------- --------
Net Proceeds from sale of stock 190,845
Net Proceeds from revolving credit
facility 106,700
Other (476) (34)
--------- --------
Net cash provided by financing
activities 312,436 29,070
--------- --------
Net increase (decrease) in cash and
equivalents 183,717 14,917
Cash and equivalents at beginning of
period 34,753 19,463
--------- --------
Cash and equivalents at end of period 218,470 34,380
--------- --------
Short term investments - 20,028
--------- --------
Cash, equivalents and short term
investments $ 218,470 $ 54,408
========= ========
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Investor Relations Contact:
Jon Kruljac
Synergy Resources Corporation
jkruljac@syrginfo.com
Tel (303) 840-8166
Company Contact:
Rhonda Sandquist
Synergy Resources Corporation
rsandquist@syrginfo.com
Tel (970) 737-1073
Source: Synergy Resources Corp.
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