Press Release
  

FOR IMMEDIATE RELEASE
August 8, 2014 NYSE MKT: REI

RING ENERGY ANNOUNCES SECOND QUARTER AND SIX MONTH 2014 FINANCIAL
AND OPERATING RESULTS

88% Increase In Revenue Over First Quarter
142% Increase In Earnings Over First Quarter
83% Increase In Production over First Quarter

Midland, TX. August 8, 2014 – Ring Energy, Inc. (NYSE MKT: REI) (“Ring”)(“Company”) announced today financial results for the three months and six months ended June 30, 2014. For the three month period ended June 30, 2014, Ring had oil and gas revenues of $11,204,238, compared to $1,291,579 for the quarter ended June 30, 2013, a 767% increase and net income of $2,821,738 or $0.11 per fully diluted share, compared to a net loss of $890,393, or $0.06 per fully diluted share, for the same period in 2013. Compared to the first quarter ended March 31, 2014, Ring had an 88% increase in oil and gas revenues and a 142% increase in earnings. For the six month period ended June 30, 2014, the Company reported oil and gas revenues of $17,174,690, compared to oil and gas revenues of $2,443,536 for the six month period ended June 30, 2013, a 603% increase. Net income for the six month period ended June 30, 2014 was $3,985,427, or $0.16 per fully diluted share, compared to a net loss of $1,855,673, or $0.13 per fully diluted share, for the same period in 2013.

The revenue increase was a result of increases in production volumes due to increased development activity. For the three months ended June 30, 2014, oil sales volume increased to 118,533 barrels, compared to 14,261 barrels for the same period in 2013, a 731% increase, and gas sales volume increased to 7,142 MCF (thousand cubic feet), compared to 7,092 MCF for the same period in 2013, a .7% increase. For the six months ended June 30, 2014, oil sales volume increased to 182,477 barrels, compared to 28,506 barrels for the same period in 2013, a 540% increase, and gas sales volume increased to 15,759 MCF, compared to 12,849 MCF for the same period in 2013, a 23% increase. The average commodity prices received by Ring were $93.84 per barrel of oil and $4.98 per MCF of natural gas for the quarter ended June 30, 2014, compared to $89.02 per barrel of oil and $3.10 per MCF of natural gas for the quarter ended June 30, 2013. The average prices received for the six months ended June 30, 2014 were $93.69 per barrel of oil and $4.93 per MCF of natural gas, compared to $84.41 per barrel of oil and $2.91 per MCF of natural gas for the six month period ended June 30, 2013.

Lease operating expenses, including production taxes, for the three months ended June 30, 2014 were $13.32 per barrel of oil equivalent (“BOE”), a 25% decrease from the prior year. Depreciation, depletion and amortization costs increased 13% to $29.05 per BOE. General and administrative costs, which included a $640,101 charge for stock based compensation, were $13.65 per BOE, an 86% decrease. For the six months ended June 30, 2014, lease operating expenses, including production taxes, were $14.27 per BOE, a 7% decrease. Depreciation, depletion and amortization costs were $27.06 per BOE, a 12% increase, and general and administrative costs, which included a $1,299,569 charge for stock based compensation, were $17.28 per BOE, a 83% decrease.

There was no outstanding debt on the Company’s $150 million senior secured credit facility at July 1, 2014.

Net cash flow from operations for the three and six months ended June 30, 2014 was $8,614,602, or $0.34 per fully diluted share, and $12,633,000, or $0.51 per fully diluted share, compared to net cash flow of $404,051, or $0.03, and $609,595, or $0.04 per fully diluted share for the same periods in 2013 (1).

In June, the Company received approximately $28.7 million in net proceeds from the private sale of approximately 2,000,000 shares of the Company’s restricted common stock. Also in June, the Company’s common stock became part of the Russell 2000 Index.

Ring’s Chief Executive Officer, Mr. Kelly Hoffman, stated, “Despite some weather and power outage disruptions in the first quarter, we were able to successfully continue our overall development program in the second quarter, with particular emphasis on our Permian Basin properties. We drilled 36 new development wells and continued infrastructure improvements, as well as stepping up our leasing activity. Our second quarter production of 119,000 BOEs was a 675% increase over the same period in 2013 and over an 83% increase from the first quarter. We completed a $30 million private placement of our common stock which has provided sufficient capex funding, based on our current budget, into 2015. We are in discussions with pipeline companies to start delivering a portion of our production directly into pipeline, and we are continuing to look at acquisition opportunities, primarily concentrating on those that compliment our existing properties.”

Non-GAAP Financial Measures:
Earnings for the three months ended June 30, 2014 include a non-cash charge for stock based compensation of $640,101. Earnings for the six months ended June 30, 2014 include a non-cash charge for stock based compensation of $1,299,569. Excluding such items, the Company’s earnings would have been $0.13 per diluted share for the three months ended June 30, 2014, and $0.19 for the six months ended June 30, 2014. The Company believes results excluding these items are more comparable to estimates provided by security analysts and, therefore, are useful in evaluating operational trends of the Company and its performance, compared to other similarly situated oil and gas producing companies.

(1) Cash Flow from Operations is a non-GAAP financial measure that represents “Net Cash Provided By Operating Activities” adjusted for the change in operating assets and liabilities. See below for a reconciliation of the related amounts.

RING ENERGY, INC.
STATEMENTS OF OPERATIONS
  Three Months Ended
June 30,
Six Months Ended
June 30,
 
2014
(Unaudited)
2013
(Unaudited)
2014
(Unaudited)
2013
(Unaudited)
Oil and Gas Revenues
$11,204,238 $1,291,579 $17,174,690 $2,443,536
     
Cost and Operating Expenses
   
     Oil and gas production costs 1,077,878 214,468 1.848,978 355.723
     Oil and gas production taxes 517,052 59,459 793,013 112,676
     Depreciation, depletion and amortization 3,477,816 396,662 5,008,012 740,270
     Accretion expense 37,312 11,824 61,694 23,277
     General and administrative expense 1,634,807 1,499,559 3,199,268 3,067,263
     
     Total Costs and Operating Expenses 6,744,865 2,181,972 10,910,965 4,299,209
     
Other Income (Expense)    
     Interest income 19,576 62,349
     
     Net Other Income 19,576 62,349
     
Income (Loss) Before Provision for Income Taxes 4,478,949 (890,393) 6,326,074 (1,855,673)
     
Income tax provision (1,657,211) (2,340,647)
     
Net Income (Loss) $2,821,738 ($890,393) $3,985,427 ($1,855,673
     
Basic Net Income (Loss) Per Common Share $0.12 ($0.06) $0.17 ($0.13)
Diluted Net Income (Loss) Per Common Share $0.11 ($0.06) $0.16 ($0.13)
     
Basic Weighted-Average Common Shares Outstanding 23,907,651 14,350,284 23,745,406 14,290,060
Diluted Weighted-Average Common Shares Outstanding 25,151,932 14,350,284 24,926,088 14,290,060
     

RING ENERGY, INC.
COMPARATIVE OPERATING STATISTICS
    Three Months Ended June 30,
    2014
2013
Change
Net Production - BOE per day
  1,316 170 674%
Per BOE:    
     Average Sales Price   $93.58 $83.64 12%
             
     Operating Costs   $9.00 $13.89 -35%
     DD&A   $29.05 $25.69 13%
     General and Administrative Expenses   $13.65 $97.10 -86%
     
    Six Months Ended June 30,
    2014 2013 Change
Net Production - BOE per day   1,023 169 505%
Per BOE:        
     Average Sales Price   $92.78 $79.73 16%
         
     Operating Costs   $9.99 $11.61 -14%
     DD&A   $27.06 $24.15 12%)
     General and Administrative Expenses   $17.28 $100.08 -83%

RING ENERGY, INC.
CONSOLIDATED BALANCE SHEET
 
June 30,
2014
December 31,
2013
ASSETS
   
Current Assets
   
     Cash $45,535,352 $52,350,583
     Accounts receivable 4,780,627 3,888,402
     Prepaid expenses and retainers 259,096 66,051
     Total Current Assets 50,575,075 56,305,036
Property and Equipment, Using Full cost Accounting    
     Oil and Gas properties subject to amortization 107,371,894 58,040,724
     Office Equipment 497,121 257,911
        Total Property Equipment 107,869,015 58,298,635
     Less: Accumulated depreciation and amortization (7,888,265) (2,880,253)
     Net Property and Equipment 99,980,750 55,418,382
Total Assets $150,555,825 $111,723,418
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Current Liabilities    
     Accounts payable $7,944,774 $6,229,490
     Other accrued liabilities 709,566 1,002,153
     Total Current Liabilities 8,654,340 7,231,643
Noncurrent Liabilities    
     Deferred income taxes 3.044,298 703,651
     Asset retirement obligation 2,276,845 1,182,410
     Total Noncurrent Liabilites 5,321,143 1,886,061
     
Stockholders' Equity    
     Preferred stock - $0.001 par value; 50,000,000 shares authorized    
     No shares issued or outstanding
     Common stock - $0.001 par value; 150,000,000 shares authorized    
     23,601,674 shares and 23,576,313 shares outstanding, respectively 25,646 23,576
     Additional paid-in capital 139,005,296 109,018,165
     Accumulated deficit (2,450,600) (6,436,027)
     Total Stockholders' Equity 136,580,342 102,605,714
Total Liabilities and Stockholders' Equity $150,555,825 $111.723,418
     

RING ENERGY, INC.
STATEMENTS OF CASH FLOW
  Six Months Ended
June 30,
 
2014
2013
Cash Flows From Operating Activities
   
     Net Income $3,985,427 ($1,855,673)
     Adjustments to reconcile net income to net cash provided
     by operating activities:
   
       Depreciation, depletion and amortization 5,008,012 740,270
       Accretion expense 61,694 23,277
       Shared-based compensation 1,299,569 1,701,721
       Provision for income taxes 2,340,647
     Changes in assets and liabilities:    
       Accounts receivable (892,225) (45,956)
       Prepaid expenses (193,045) (32,795)
       Accounts payable 1,422,697 839,621
Net Cash Provided by Operating Activities 13,032,776 1,370,465
Cash Flows from Investing Activities    
     Payments to purchase oil and natural gas properties (10,974,396) (1,751,342)
     Payments to develop oil and natural gas properties (37,324,033) (5,524,201)
     Purchase of equipment and vehicles (239,210) (54,441)
     Net Cash Used in Investing Activities (48,537,639) (7,329,984)
Cash Flows from Financing Activities    
     Proceeds from option exercise 22,500
     Proceeds from issuance of common stock 28,667,132 18,987,272
     Net Cash Provided by Financing Activties 28,667,132 18,987,272
Net Increase in Cash (6,815,231) 13,027,753
Cash at Beginning of Period 52,350,583 5,404,167
Cash at End of Period $45,535,352 $18,431,920
     
Non-Cash Investing and Financing Activities    
     Revision of asset retirement obligation estimate    $211,691
     Asset retirement obligation acquired $294,772
     Asset retirement obligation incurred during development 737,969 67,352
     
RECONCILIATION OF CASH FLOW FROM OPERATIONS
Net cash provided by operating activities $13,032,776 $1,370,465
Change in operating assets and liabilities (337,427) (760,870)
     
Cash flow from operations $12,695,349 $609,595
Management believes that the non-GAAP measure of cash flow from operators is useful information for investors because it is used internally and is accepted by the investment community as a means of measuring the Company's ability to fund its capital program. It is also used by professional research analysts in providing investment recommendations pertaining to companies in the oil and gas exploration and production industry.
     

RING ENERGY, INC.
NON-GAAP DISCLOSURE RECONCILIATION
ADJUSTED EBITDA
  Six Months Ended
 
June 30,
2014
June 30,
2013
NET INCOME (LOSS)
$3,985,427 ($1,855,673)
     
     Interest expense (Income) (62,349)
     Income tax expense 2,340,647
     Depreciation, depletion and amortization 5,008,012 740,270
     Accretion expense 61,694 23,277
     Shared-based compensation 1,299,569 1,701,721
     
ADJUSTED EBITDA $12,633,000 $609,595
     


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


 
  December 2, 2014

RING ENERGY, INC. CONTINUES
2014 DEVELOPMENT PROGRAM

Company Operates Profitably At Current Commodity Prices
 
  November 6, 2014

RING ENERGY, INC.ANNOUNCES THIRD QUARTER AND NINE MONTH 2014 FINANCIAL AND OPERATING RESULTS
Third Quarter 2014 Revenues Increase 287% Over Third Quarter Revenues 2013
Nine Month 2014 Revenues Increase 434% Over Nine Month Revenues 2013
 
  October 7, 2014

RING ENERGY, INC.PROVIDES THIRD QUARTER
2014 OPERATIONS UPDATE

Production Increases 19% Over Second Quarter
Company Adds Third Drilling Rig
Company Increases 2014 CAPEX to $125 Million
 
  August 8, 2014

RING ENERGY, INC. ANNOUNCES SECOND QUARTER AND SIX MONTH 2014 FINANCIAL AND OPERATING RESULTS
88% Increase in Revenue Over First Quarter

142% Increase in Revenue Over First Quarter
83% Increase in Revenue Over First Quarter
 
  July 15, 2014

RING ENERGY, INC. PROVIDES SECOND QUARTER 2014 OPERATIONS UPDATE
Second Quarter Production Increases 69% Over First Quarter 2014
Company Provides Update on Kansas Joint Venture Pilot Drilling Program
 
  June 17, 2014

RING ENERGY, INC. ANNOUNCES $30 MILLION PRIVATE PLACEMENT OF COMMON STOCK
Company Also Establishes New Credit Facility
 
  May 8, 2014

RING ENERGY, INC. ANNOUNCES FINANCIAL RESULTS FOR FIRST QUARTER 2014
418% Increase in revenue For The Three Months to $5.97 Million
221% Increase in Net Income For The Three Months to $1.1 Million
 
  April 22, 2014

RING ENERGY, INC. PROVIDES
FIRST QUARTER 2014 OPERATIONS UPDATE
2014 Capital Expenditure Budget Increased
to $115 Million
 
  March 21, 2014

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%
 
  March 4, 2014

RING ENERGY, INC. CLOSES PERMIAN BASIN ACREAGE ACQUISITION
Adds Reserves, Drilling Locations / Contracts Second Drilling Rig
 
  January 14, 2014

RING ENERGY, INC. PROVIDES FOURTH QUARTER 2013 OPERATIONS UPDATE
 
 
 

 
   
   

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Ring Energy, Inc. is an independent oil and gas exploration company with headquarters in Midland, Texas. Ring Energy’s business strategy is focused on the exploration, development and acquisition of oil and natural gas properties in the Permian and Mid-Continent regions of the United States.

   
   

 

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