FOR IMMEDIATE RELEASE
March 21, 2014 NYSE MKT: REI
RING ENERGY ANNOUNCES FINANCIAL AND OPERATIONAL RESULTS
FOR FOURTH QUARTER AND YEAR END 2013
2013 Revenues Increase 487%
2013 Cash Flow Increases 817%
Fourth Quarter Revenues Increase 609%
MIDLAND, Texas — Ring Energy, Inc. (NYSE MKT: REI) (“Ring”) (“Company”) announced today financial results for the fourth quarter and year ended December 31, 2013.
Ring had net income of $1,534,957, a 1,047% increase, on oil and gas revenues of $5,051,434 a 609% increase, for the fourth quarter compared to net income of $133,821 on revenues of $712,180 for the fourth quarter ended December 31, 2012. For the year ended December 31, 2013, Ring had a loss of $452,209 on revenues of $10,315,701, a 487% increase, as compared to a loss of $1,669,283 on revenues of $1,757,444 for the year ended December 31, 2012. Income attributable to common shares for the fourth quarter was $0.08 per diluted share compared to $0.02 for the fourth quarter ended December 31, 2012. For the year ended December 31, 2013, the loss attributable to common shares was $0.02 per diluted share compared to a loss of $0.21 per diluted share for the year ended December 31, 2012.
The increase in revenue is attributed to an increase in production, primarily due to development and acquisition activities. For the three months ended December 31, 2013, oil sales volume increased to 54,557 barrels, compared to 8,878 barrels for the same period in 2012, and gas sales volume increased to 13,607 MCF (thousand cubic feet), compared to 3,161 MCF for the same period in 2012. For the twelve months ended December 31, 2013, oil sales volume increased to 109,673 barrels, compared to 20,531 barrels for the same period in 2012, and gas sales volume increased to 36,047 MCF, compared to 6,480 MCF for the same period in 2012. The average commodity prices received by Ring were $91.41 per barrel of oil and $4.72 per MCF of natural gas for the quarter ended December 31, 2013, compared to $79.07 per barrel of oil and $3.22 per MCF of natural gas for the quarter ended December 31, 2012. The average prices received for the twelve months ended December 31, 2013 were $92.81 per barrel of oil and $3.82 per MCF of natural gas, compared to $84.50 per barrel of oil and $3.50 per MCF of natural gas for the twelve month period ended December 31, 2012. In January, the company stated that net production for the fourth quarter was approximately 64,010 BOE (Barrel of Oil Equivalent). Total net sales production for the fourth quarter of 2013 was 56,825 BOE, as compared to 9,405 BOE for the same period in 2012, an increase of 504%. The remaining fourth quarter production that was not sold in 2013 was held in storage and sold in the first quarter 2014. Net sales production for the full year 2013 was 115,681 BOE, compared to 21,611 BOE in 2012, an increase of 435%. Lease operating expenses, including production taxes, for the three and twelve month periods ended December 31, 2013 were $13.97 and $14.56 per BOE, as compared to $24.12 and $40.21 per BOE for the same periods in 2012.
Proved reserves, as determined by Cawley, Gillespie and Associates, totaled 7,270,164 barrels of oil equivalents (BOE), an 85% increase over the 3,935,706 BOE for the previous year. Future net revenues before income taxes, discounted at 10% (“PV-10”), based on $92.54 per barrel of oil and $5.88 per MCF of gas, were $198.4 million at year-end 2013. This compared to $106 million, using average prices of $88.59 per barrel of oil and $4.90 per MCF of gas, for year-end 2012. Internal engineering has estimated an additional 2.7 million BOE of probable reserves with a PV-10 of $74.1 million using average prices of $92.54 per barrel of oil and $5.88 per MCF of gas.
Cash provided by operating activities, before changes in working capital, for the three and twelve months ended December 31, 2013 was $3,246,839, or $0.12 per fully diluted share, and $5,552,286, or $0.34 per fully diluted share, compared to $161,307 and a negative $773,970, or $0.02 and a negative $0.10 per fully diluted share for the same periods in 2012. Net cash flow in the fourth quarter 2013 increased over 91% from the third quarter 2013. Earnings before interest, taxes, depletion and other non-cash items (“Adjusted EBITDA”) for the three and twelve months ended December 31, 2013 was $3,244,263, or $0.16 per fully diluted share, and $5,537,470, or $0.34 per fully diluted share, compared to $156,193 and a negative $559,474, or $0.02 and a negative $0.07 in 2012. (See accompanying table for a reconciliation of net income to adjusted EBITDA)
“2013 was a year of substantial growth for Ring in production, reserves, acreage and revenue,” said Mr. Kelly Hoffman, Chief Executive Officer. “Over and above the values that were assigned by our outside engineering group, we have identified over 1,740 additional potential drilling locations made possible through the internal development of our existing properties and recent acreage acquisition. We expect 2014 to continue to show the same trends as 2013, even though our first quarter production was hampered by weather.”
About Ring Energy, Inc.
Ring Energy, Inc. is an oil and gas exploration, development and production company with current operations in Texas and Kansas.
Safe Harbor Statement
This release contains forward-looking statements within the meaning of the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995 that involve a wide variety of risks and uncertainties, including, without limitations, statements with respect to the Company’s strategy and prospects. Such statements are subject to certain risks and uncertainties which are disclosed in the Company’s reports filed with the SEC, including its Form 10-K for the fiscal year ended December 31, 2013, its Form 10-Q for the quarter ended September 30, 2014 and its other filings with the SEC. Readers and investors are cautioned that the Company’s actual results may differ materially from those described in the forward-looking statements due to a number of factors, including, but not limited to, the Company’s ability to acquire productive oil and/or gas properties or to successfully drill and complete oil and/or gas wells on such properties, general economic conditions both domestically and abroad, and the conduct of business by the Company, and other factors that may be more fully described in additional documents set forth by the Company.
For further information contact:
Bill Parsons, K M Financial, Inc.
(702) 489-4447 office
(602) 315-5926 mobile