Press Release
  

FOR IMMEDIATE RELEASE
November 6, 2014 NYSE American: REI

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

Midland, TX. Novemvber 6, 2014 – Ring Energy, Inc. (NYSE American: REI) (“Ring”)(“Company”) announced today financial results for the three months and nine months ended September 30, 2014. For the three month period ended September 30, 2014, Ring had oil and gas revenues of $10,929,771, compared to $2,820,731 for the quarter ended September 30, 2013, a 287% increase and net income of $1,726,469 or $0.06 per fully diluted share, compared to a net loss of $131,493, or $0.01 per fully diluted share, for the same period in 2013. For the nine month period ended September 30, 2014, the Company reported oil and gas revenues of $28,104,461, compared to oil and gas revenues of $5,264,267 for the nine month period ended September 30, 2013, a 434% increase. Net income for the nine month period ended September 30, 2014 was $5,711,896, or $0.22 per fully diluted share, compared to a net loss of $1,987,166, or $0.13 per fully diluted share, for the same period in 2013.

The revenue increase was due to increases in production volumes resulting from development of our leases. For the three months ended September 30, 2014, oil sales volume increased to 124,526 barrels, compared to 26,609 barrels for the same period in 2013, and gas sales volume decreased to 8,192 MCF (thousand cubic feet), compared to 9,591 MCF for the same period in 2013. For the nine months ended September 30, 2014, oil sales volume increased to 307,003 barrels, compared to 55,116 barrels for the same period in 2013, and gas sales volume increased to 23,951 MCF, compared to 22,440 MCF for the same period in 2013. The average commodity prices received by Ring were $87.58 per barrel of oil and $2.92 per MCF of natural gas for the quarter ended September 30, 2014, compared to $104.65 per barrel of oil and $3.75 per MCF of natural gas for the quarter ended September 30, 2013. The average prices received for the nine months ended September 30, 2014 were $91.21 per barrel of oil and $4.24 per MCF of natural gas, compared to $94.18 per barrel of oil and $3.27 per MCF of natural gas for the nine month period ended September 30, 2013.

Lease operating expenses, including production taxes, for the three months ended September 30, 2014 were $14.71 per barrel of oil equivalent (“BOE”), a 2% decrease from the prior year. Depreciation, depletion and amortization costs, including accretion, increased 9% to $36.04 per BOE. General and administrative costs, which included a $630,766 charge for stock based compensation, were $14.43 per BOE, a 75% decrease. For the nine months ended September 30, 2014, lease operating expenses, including production taxes, were $14.45 per BOE, a 4% decrease. Depreciation, depletion and amortization costs, including accretion, were $30.89 per BOE, a 7% increase, and general and administrative costs, which included a $1,930,335 charge for stock based compensation, were $16.13 per BOE, an 80% decrease.

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

Net cash flow from operations for the three and nine months ended September 30, 2014 was $7,995,660 or $0.30 per fully diluted share, and $20,691,009, or $0.81 per fully diluted share, compared to net cash flow of $1,695,854 and $2,305,449, or $0.09 and $0.14 per fully diluted share for the same periods in 2013 (1).

Ring’s Chief Executive Officer, Mr. Kelly Hoffman, stated, “I am extremely proud of the job our operations team has done. We continued to execute our business plan, despite severe weather disruptions resulting in as many as 20 producing wells being shut in and numerous other wells delayed in various stages of drilling or completion during the third quarter. Our production grew close to 20% over the second quarter despite these problems. We continued to add acreage resulting in additional potential drill sites. We estimate the Company currently has over 2,100 potential drilling locations. We have added a third drilling rig and plan to drill approximately 15 new wells per month through the remainder of 2014 on our Texas properties. We have increased our capital expenditure budget from $115 million to $125 million for 2014 and are continuing to look at acquisition opportunities.”

Non-GAAP Financial Measures:

Earnings for the three months ended September 30, 2014 include a non-cash charge for stock based compensation of $630,766. Earnings for the nine months ended September 30, 2014 include a non-cash charge for stock based compensation of $1,930,335. Excluding such items, the Company’s earnings would have been $0.08 per diluted share for the three months ended September 30, 2014, and $0.27 for the nine months ended September 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
September 30,
Nine Months Ended
September 30,
 
2014
(Unaudited)
2013
(Unaudited)
2014
(Unaudited)
2013
(Unaudited)
Oil and Gas Revenues
$10,929,771 $2,820,731 $28,104,461 $5,264,267
     
Cost and Operating Expenses
   
     Oil and gas production costs 1,347,929 291,182 3.196,907 646,905
     Oil and gas production taxes 504,091 130,944 1,297,104 243,620
     Depreciation, depletion and amortization 4,494,868 917,116 9,502,880 1,657,386
     Accretion expense 42,548 13,906 104,242 37,183
     General and administrative expense 1,816,131 1,611,318 5,015,399 4,678,581
     
     Total Costs and Operating Expenses 8,205,567 2,964,466 19,116,532 7,263,675
     
Other Income (Expense)    
     Interest income 16,224 12,242 78,573 12,242
     
     Net Other Income (Expense) 16,224 12,242 78,573 12,242
     
Income (Loss) Before Provision for Income Taxes 2,740,428 (131,493) 9,066,502 (1,987,166)
     
Income tax provision (1,013,959) (3,354,606)
     
Net Income (Loss) $1,726,469 ($131,493) $5,711,896 ($1,987,166)
     
Basic Net Income (Loss) Per Common Share $0.07 ($0.01) $0.23 ($0.13)
Diluted Net Income (Loss) Per Common Share $0.06 ($0.01) $0.22 ($0.13)
     
Basic Weighted-Average Common Shares Outstanding 25,707,371 17,801,313 24,406,581 15,473,339
Diluted Weighted-Average Common Shares Outstanding 26,881,710 17,801,313 25,568,065 15,473,339
     

RING ENERGY, INC.
COMPARATIVE OPERATING STATISTICS
    Three Months Ended Septmber 30,
    2014
2013
Change
Net Production - BOE per day
  1,368 307 346%
Per BOE:    
     Average Sales Price   $86.82 $100.00 -13%
             
     Operating Costs (Includes Production Taxes)   $14.71 $14.96 -2%
     DD&A (Includes Accretion)   $36.04 $33.01 9%
     General and Administrative Expenses   $14.43 $57.12 -75%
     
    Nine Months Ended September 30,
    2014 2013 Change
Net Production - BOE per day   1,139 216 427%
Per BOE:        
     Average Sales Price   $90.37 $89.44 1%
         
     Operating Costs (Includes Production Taxes)   $14.45 $15.13 -4%
     DD&A (Includes Accretion)   $30.89 $28.79 7%)
     General and Administrative Expenses   $16.13 $79.49 -80%

RING ENERGY, INC.
CONSOLIDATED BALANCE SHEET
 
September 30,
2014
December 31,
2013
ASSETS
   
Current Assets
   
     Cash $29,066,848 $52,350,583
     Accounts receivable 2,992,849 3,888,402
     Joint interest billing receivable 1,373,213
     Prepaid expenses and retainers 216,853 66,051
     Total Current Assets 33,649,763 56,305,036
Property and Equipment, Using Full cost Accounting    
     Oil and Gas properties subject to amortization 133,091,421 58,040,724
     Office Equipment 857,298 257,911
        Total Property Equipment 133,948,719 58,298,635
     Less: Accumulated depreciation and amortization (12,383,133) (2,880,253)
     Net Property and Equipment 121,565,586 55,418,382
Total Assets $155,215,349 $111,723,418
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Current Liabilities    
     Accounts payable $8,727,724 $6,229,490
     Other accrued liabilities 429,859 1,002,153
     Total Current Liabilities 9,157,583 7,231,643
Noncurrent Liabilities    
     Deferred income taxes 4,058,257 703,651
     Asset retirement obligation 2,792,810 1,182,410
     Total Noncurrent Liabilites 6,851,067 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    
     25,725,001 shares and 23,576,313 shares outstanding, respectively 25,725 23,576
     Additional paid-in capital 139,905,105 109,018,165
     Accumulated deficit (724,131) (6,436,027)
     Total Stockholders' Equity 139,206,699 102,605,714
Total Liabilities and Stockholders' Equity $155,215,349 $111,723,418
     

RING ENERGY, INC.
STATEMENTS OF CASH FLOW
  Nine Months Ended
September 30,
 
2014
2013
Cash Flows From Operating Activities
   
     Net Income $5,711,896 ($1,987,166)
     Adjustments to reconcile net income to net cash provided
     by operating activities:
   
       Depreciation, depletion and amortization 9,502,880 1,657,386
       Accretion expense 104,242 37,183
       Shared-based compensation 1,930,335 2,598,046
       Stock issued 87,050
       Provision for income taxes 3,354,606
     Changes in assets and liabilities:    
       Accounts receivable (477,660) (1,304,357)
       Prepaid expenses (150,802) (8,169)
       Accounts payable 1,925,940 4,056,603
Net Cash Provided by Operating Activities 21,988,487 5,049,526
Cash Flows from Investing Activities    
     Payments to purchase oil and natural gas properties (12,438,370) (4,125,676)
     Payments to develop oil and natural gas properties (60,938,454) (17,356,478)
     Purchase of equipment and vehicles (599,387) (82,805)
     Plugging and abandonment costs icurred (37,287)  
     Net Cash Used in Investing Activities (74,013,498) (21,564,959)
Cash Flows from Financing Activities    
     Proceeds from option exercise 215,000
     Proceeds from issuance of common stock 28,526,276 18,978,882
     Net Cash Provided by Financing Activties 28,741,276 18,978,882
Net Increase (Decrease) in Cash (23,283,735) 2,463,449
Cash at Beginning of Period 52,350,583 5,404,167
Cash at End of Period $29,066,848 $7,867,616
     
Non-Cash Investing and Financing Activities    
     Revision of asset retirement obligation estimate $211,691
     Stock issued as consideration in property acquisition $130.428
     Asset retirement obligation acquired $322,879
     Asset retirement obligation incurred during development 1,220,566 309,838
     
RECONCILIATION OF CASH FLOW FROM OPERATIONS
Net cash provided by operating activities $21,988,487 $5,049,526
Change in operating assets and liabilities (1,297,478) (2,744,077)
     
Cash flow from operations $20,691,009 $2,305,449
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
  Nine Months Ended
 
September 30,
2014
September 30,
2013
NET INCOME
$5,711,896 ($1,987,166)
     
     Interest expense (Income) (78,573) (12,242)
     Income tax expense 3,354,606
     Depreciation, depletion and amortization 9,502,880 1,657,386
     Accretion expense 104,242 37,183
     Shared-based compensation 1,930,335 2,598,046
     
ADJUSTED EBITDA $20,525,386 $2,293,592075
     


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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