Press Release
  

FOR IMMEDIATE RELEASE
March 15, 2016 NYSE American: REI

RING ENERGY ANNOUNCES FINANCIAL AND OPERATIONAL RESULTS FOR FOURTH QUARTER
AND YEAR END 2015

Midland, TX. March 15, 2016 – Ring Energy, Inc. (NYSE American: REI) (“Ring”)(“Company”) announced today financial results for the fourth quarter and year ended December 31, 2015.

For the fourth quarter of 2015, Ring reported revenues of $7,362,394, as compared to revenues of $9,984,982 for the fourth quarter of 2014. For the year ended December 31, 2015, the Company reported revenues of $31,013,892, as compared to $38,089,443 for the year ended December 31, 2014. For the fourth quarter of 2015, Ring reported a net loss of $7,473,046, or $0.25 per diluted share, which included a pre-tax non-cash impairment of $9,312,203. Excluding the impairment, the net loss per diluted share would have been $0.05. For the year ended December 31, 2015, the Company reported a net loss of $9,052,771, or $0.32 per diluted share, which included a pre-tax non-cash impairment of $9,312,203. Excluding the impairment, the net loss per diluted share would have been $0.11. This information compares to net income of $2,708,604, or $0.10 per diluted share for the fourth quarter of 2014, and $8,420,500, or $0.33 per diluted share for the year ended December 31, 2014.

The decrease in revenue is primarily attributed to lower commodity prices received. For the three months ended December 31, 2015, oil sales volume increased to 180,694 barrels, compared to 150,036 barrels for the same period in 2014, and gas sales volume increased to 192,202 MCF (thousand cubic feet), compared to 14,784 MCF for the same period in 2014. For the twelve months ended December 31, 2015, oil sales volume increased to 664,612 barrels, compared to 457,039 barrels for the same period in 2014, and gas sales volume increased to 472,509 MCF, compared to 38,735 MCF for the same period in 2014. The average commodity prices received by Ring were $38.43 per barrel of oil and $2.18 per MCF of natural gas for the quarter ended December 31, 2015, compared to $66.32 per barrel of oil and $2.36 per MCF of natural gas for the quarter ended December 31, 2014. The average prices received for the twelve months ended December 31, 2015 were $44.90 per barrel of oil and $2.48 per MCF of natural gas, compared to $83.04 per barrel of oil and $3.53 per MCF of natural gas for the twelve month period ended December 31, 2014.

Lease operating expenses, including production taxes, for the three months ended December 31, 2015 were $15.63 per barrel of oil equivalent (“BOE”), a 5% increase from the prior year. Depreciation, depletion and amortization costs, including accretion, increased 16% to $17.94 per BOE. General and administrative costs, which included a $604,574 charge for stock based compensation, were $10.44 per BOE, an 11% decrease. For the twelve months ended December 30, 2015, lease operating expenses, including production taxes, were $15.37 per BOE, a 5% increase. Depreciation, depletion and amortization costs, including accretion, were $20.98 per BOE, a 19% decrease, and general and administrative costs, which included a $2,566,716 charge for stock based compensation, were $10.76 per BOE, a 27% decrease from 2014.

Cash provided by operating activities, before changes in working capital, for the three and twelve months ended December 31, 2015 was $2,106,864, or $0.07 per fully diluted share, and $13,416,610, or $0.48 per fully diluted share, compared to $6,532,258 and $27,223,267, or $0.24 and $1.05 per fully diluted share for the same periods in 2014. Earnings before interest, taxes, depletion and other non-cash items (“Adjusted EBITDA”) for the three and twelve months ended December 31, 2015 was $2,421,885, or $0.08 per fully diluted share, and $14,158,760, or $0.50 per fully diluted share, compared to $6,611,916 and $27,137,303, or $0.25 and $1.05 in 2014. (See accompanying table for a reconciliation of net income to adjusted EBITDA).

There was outstanding debt of $45,900,000 on the Company’s $500 million senior secured credit facility at December 31, 2015.

Proved reserves, as determined by Cawley, Gillespie and Associates, Inc., and Williamson Petroleum Consultants, Inc., totaled 24,402,383 barrel of oil equivalents (BOE), a 134% increase over the 10,407,009 BOE for the previous year. Future net revenues before income taxes, discounted at 10% (“PV-10”), based on $48.17 per barrel of oil and $2.51 per MCF of gas, were $240.2 million at year-end 2015. This compared to $281.7 million, using average prices of $85.10 per barrel of oil and $3.95 per MCF of gas, for year-end 2014. Approximately 33% of the proved reserves are classified as proved developed producing (“PDP”), 2% proved developed non-producing (“PDNP”), and 65% proved undeveloped (“PUD”). The proved reserves consist of approximately 91% oil and 9% natural gas. Internal engineering has estimated an additional 11.1 million BOE of probable reserves with a PV-10 of $61.1 million using average prices of $47.59 per barrel of oil and $1.99 per MCF of natural gas.

Mr. Kelly Hoffman, the Company’s Chief Executive Officer, commented, “I am very pleased with our 2015 operating and financial results. We continue to increase production and reserves during a period in which we have virtually halted any new drilling activity. Our operations team has not only done an excellent job maximizing current operating efficiencies, but also in evaluating and identifying future development opportunities within our core assets which are in addition to those stated above. The results of that internal study, combining both the Central Basin Platform and Delaware Basin assets, identified over 1,500 additional potential vertical drilling locations on 10 and 20 acre spacing. Also, in addition, the study, using actual results from surrounding operators, identified over 225 potential horizontal locations. We are cautiously optimistic that commodity prices will start to firm up before year end and are anxious to restart our development drilling. We continue to look at opportunities that would complement our core assets, but regardless of any future acquisitions, the Company is well postured for sustained growth.”

Non-GAAP Financial Measures:

Net loss for the three months ended December 31, 2015 includes a non-cash charge for stock based compensation of $604,574, and a ceiling test impairment charge of $9,312,203. Net loss for the twelve months ended December 31, 2015 includes a non-cash charge for stock based compensation of $2,566,716, and a ceiling test impairment charge of $9,312,203. Excluding such items, the Company’s net loss would have been $0.04 per diluted share for the three months ended December 31, 2015, and $0.05 for the twelve months ended December 31, 2015. 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.

RING ENERGY, INC.
STATEMENTS OF OPERATIONS
  Three Months Ended
December 31,
Twelve Months Ended
December 31,
 
2015
2014
2015
2014
Oil and Gas Revenues
$ 7,362,394 $ 9,984,982 $ 31,013,892 $ 38,089,443
     
Cost and Operating Expenses
   
     Oil and gas production costs 2,967,232 1,796,259 9,958,380 4,993,166
     Oil and gas production taxes 357,811 463,102 1,468,073 1,760,206
     Depreciation, depletion and amortization 3,648,107 2,304,914 15,175,791 11,807,794
     Ceiling test impairment 9,312,203 9,312,203
     Asset retirement obligation accretion 168,118 50,731 418,384 154,973
     General and administrative expense 2,220,040 1,787,630 7,995,395 6,803,029
     
     Total Costs and Operating Expenses 18,673,511 6,402,636 44,328,226 25,519,168
         
     Income (Loss) from Operations (11,311,117) 3,582,346 (13,314,334) 12,570,275
     
Other Income (Expense)    
     Interest income 4,371 7,391 6,984 85,964
     Interest expense (319,392) (749,134)
     
     Net Other Income (315,021) 7,391 (742,150) 85,964
     
Income (Loss) Before Provision for Income Taxes (11,828,138) 3,589,737 (14,056,484) 12,656,239
     
(Provision For) Benefit From Income Taxes 4,153,092 (881,133) 5,003,713 (4,235,739)
     
Net Income (Loss) ($7,473,046) $ 2,708,604 ($9,052,771) $8,420,500
     
Basic Earnings (Loss) Per Common Share ($0.25) $0.11 ($0.32) $0.34
Diluted Earnings (Loss) Per Common Share ($0.25) $0.10 ($0.32) $0.33
         
Basic Weighted-Average Common Shares Outstanding 30,391,485 25,728,571 28,176,924 24,739,795
Diluted Weighted-Average Common Shares Outstanding 30,391,485 26,769,999 28,176,924 25,890,285
     

RING ENERGY, INC.
COMPARATIVE OPERATING STATISTICS
    Three Months Ended December 31,
    2015
2014
Change
Net Production - BOE per day
  2,312 1,658 39%
Per BOE:    
     Average Sales Price   $ 34.61 $ 65.48 -47%
             
     Lease Operating Expenses   13.95 11.78 18%
     Production Taxes   1.68 3.04 -45%
     DD&A   17.15 15.11 14%
     Accretion   0.79 0.33 139%
     General and Administrative Expenses   10.44 11.72 -11%

    Twelve Months Ended December 31,
    2015
2014
Change
Net Production - BOE per day
  2,037 1,270 60%
Per BOE:    
     Average Sales Price   $ 41.72 $ 82.18 -49%
             
     Lease Operating Expenses   13.40 10.77 24%
     Production Taxes   1.97 3.80 -48%
     DD&A   20.42 25.48 -20%
     Accretion   0.56 0.33 70%
     General and Administrative Expenses   10.76 14.68 -27%


RING ENERGY, INC.
CONSOLIDATED BALANCE SHEET
 
December 31,
2015
December 31,
2014
ASSETS
   
Current Assets
   
     Cash $ 4,431,350 $ 8,622,235
     Accounts receivable 2,507,858 3,616,676
     Joint interest billing receivable 1,629,165 2,683,787
     Prepaid expenses and retainers 146,118 160,600
     Total Current Assets 8,714,491 15,083,298
Property and Equipment    
     Oil and Natural Gas properties subject to amortization 269,590,374 166,036,400
     Fixed assets subject to depreciation 1,539,991 1,209,809
        Total Property and Equipment 271,130,365 167,246,209
     Accumulated depreciation, depletion and amortization (29,863,838) (14,688,047)
     Net Property and Equipment 241,266,527 152,558,162
Deferred Income Taxes 64,323
Deferred Financing Costs 820,904
Total Assets $ 250,866,245 $167,641,460
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Current Liabilities    
     Accounts payable $ 11,023,269 $16,241,022
     Other accrued liabilities 309,898 22,029
     Total Current Liabilities 11,333,167 16,263,051
     Deferred income taxes 4,939,390
     Long term debt 45,900,000
     Asset retirement obligation 7,401,950 3,896,489
     Total Liabilites 64,635,117 25,098,930
     
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
   
     30,391,942 shares and 25,734,467 shares
     outstanding, respectively
30,392 25,734
     Additional paid-in capital 193,269,034 140,532,323
     Retained Earnings (accumulated deficit) (7,068,298) 1,984,473
     Total Stockholders' Equity 186,231,128 142,542,530
Total Liabilities and Stockholders' Equity $ 250,866,245 $167,641,460
     

RING ENERGY, INC.
STATEMENTS OF CASH FLOW
   
  December 31, December 31,
 
2015
2014
Cash Flows From Operating Activities
   
     Net Income (loss) ($9,052,771) $ 8,420,500
     Adjustments to reconcile net income (loss) to net cash
     provided by (used in) operating activities:
   
       Depreciation, depletion and amortization 15,175,791 11,807,794
       Ceiling test impairment 9,312,203  
       Accretion expense 418,384 154,973
       Shared-based compensation 2,566,716 2,517,211
       Stock issued for services 87,050
       Deferred income taxes (benefit) (5,003,713) 4,235,739
       Changes in assets and liabilities:    
       Accounts receivable 2,163,440 (2,412,061)
       Prepaid expenses (806,422) (94,549)
       Accounts payable (4,929,884) 9,031,408
Net Cash Provided by Operating Activities 9,843,744 33,748,056
Cash Flows from Investing Activities    
     Payments to purchase oil and natural gas properties (77,902,553) (15,054,649)
     Payments to develop oil and natural gas properties (31,430,355) (90,160,236)
     Purchase of equipment, vehicles and leasehold improvements (330,182) (951,898)
     Plugging and abandonment cost incurred (446,192) (39,316)
     Net Cash Used in Investing Activities (110,109,282) (106,206,099)
Cash Flows from Financing Activities    
     Proceeds from issuance of notes payable 45,900,000
     Proceeds from issuance of common stock 50,039,853 28,514,686
     Proceeds from option exercise 134,800 215,000
Net Cash Provided by Financing Activities 96,074,653 28,729,686
Net Increase (Decrease) in Cash (4,190,885) (43,728,348)
Cash at Beginning of Period 8,622,235 52,350,583
Cash at End of Period $ 4,431,350 $ 8,622,235
     
Supplemental Cash flow information    
     Cash paid for interest $429,742
     
Non-Cash Investing and Financing Activities    
     Stock issued as consideration in property acquisition $             — $ 182,369
     Asset retirement obligation acquired 3,361,634 575,977
     Asset retirement obligation incurred during development 171,635 2,022,445
     
RECONCILIATION OF CASH FLOW FROM OPERATIONS
Net cash provided by operating activities $9,843,744 $ 33,748,065
Change in operating assets and liabilities (3,572,866) 6,524,798
     
Cash flow from operations $ 13,416,610 $ 27,223,267
Management believes that the non-GAAP measure of cash flow from operations 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
 
 
December 31,
2015
December 31,
2014
NET INCOME (LOSS)
($9,052,771) $ 8,420,500
     
     Interest expense (Income) (6,984) (85,964)
     Interest expense 749,134
     Interest tax expense (benefit) (5,003,713) 4,235,739
     Depreciation, depletion and amortization 15,175,791 11,807,794
     Accretion of discounted liabilities 418,384 154,973
     Ceiling test impairment 9,312,203
     Stock based compensation 2,566,716 2,517,211
     Stock issued as finders fee 87,050
     
ADJUSTED EBITDA $ 14,158,760 $ 27,137,303
     


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, 2015. 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 9, 2016

RING ENERGY, INC. ANNOUNCES COMPLETION OF PUBLIC OFFERING OF COMMON STOCK
 
  December 6, 2016

RING ENERGY, INC. ANNOUNCES PRICING OF
PUBLIC OFFERING OF COMMON STOCK
 
  December 5, 2016

RING ENERGY, INC. ANNOUNCES
COMMON STOCK OFFERING
 
  December 1, 2016

RING ENERGY INC. RELEASES UPDATE ON THREE WELL HORIZONTAL DRILLING PROGRAM
Management Announces Preliminary Capital Expenditure Budget (“CAPEX”) for 2017
 
  November 8, 2016

RING ENERGY INC. ANNOUNCES THIRD QUARTER AND NINE MONTH 2016 FINANCIAL AND OPERATING RESULTS
 
  November 2, 2016

RING ENERGY, INC., SCHEDULES CONFERENCE CALL ON ITS 2016 THIRD QUARTER AND NINE MONTH FINANCIAL AND OPERATING RESULTS
 
  November 1, 2016

RING ENERGY, INC. RELEASES THIRD QUARTER 2016 OPERATIONS UPDATE
 
  September 22, 2016

RING ENERGY INC. RELEASES PRELIMINARY UPDATE ON THREE WELL HORIZONTAL
DRILLING PROGRAM
Company Doubles Net Acreage Related To Horizontal Development Program In Central Basin Platform
 
  August 8, 2016

RING ENERGY, INC. SCHEDULES CONFERENCE CALL ON ITS 2016 SECOND QUARTER AND SIX MONTH FINANCIAL AND OPERATING RESULTS
 
  July 27, 2016

RING ENERGY, INC. SCHEDULES CONFERENCE CALL ON ITS 2016 SECOND QUARTER AND SIX MONTH FINANCIAL AND OPERATING RESULTS
 
  July 14, 2016

RING ENERGY, INC. ANNOUNCES SECOND QUARTER 2016 OPERATIONS UPDATE
 
  May 9, 2016

RING ENERGY ANNOUNCES FINANCIAL AND OPERATING RESULTS FOR FIRST QUARTER 2016
 
  May 5, 2016

RING ENERGY, INC. ANNOUNCES CAPITAL EXPENDITURE BUDGET OF AN ESTIMATED $23 MILLION FOR REMAINDER OF 2016
 
  May 3, 2016

RING ENERGY, INC. SCHEDULES CONFERENCE CALL ON ITS 2016 1ST QUARTER FINANCIAL
AND OPERATING RESULTS
 
  April 26, 2016

RING ENERGY, INC. ANNOUNCES EXERCISE IN FULL OF OVER-ALLOTMENT OPTION AND COMPLETION OF PUBLIC OFFERING OF
COMMON STOCK
 
  April 21, 2016

RING ENERGY, INC. ANNOUNCES PRICING OF
PUBLIC OFFERING OF COMMON STOCK
 
  April 20, 2016

RING ENERGY, INC. ANNOUNCES
COMMON STOCK OFFERING
 
  April 13, 2016

RING ENERGY, INC. ANNOUNCES FIRST
QUARTER 2016 OPERATIONS UPDATE
 
  March 15, 2016

RING ENERGY ANNOUNCES FINANCIAL AND OPERATIONAL RESULTS FOR FOURTH QUARTER AND YEAR END 2015
 
  March 2, 2016

RING ENERGY, INC. SCHEDULES CONFERENCE CALL ON ITS 2015 4TH QUARTER AND YEAR END FINANCIAL AND OPERATING RESULTS
 
  January 11, 2016

RING ENERGY, INC. ANNOUNCES FOURTH QUARTER AND YEAR END 2015 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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