Press Release
  

FOR IMMEDIATE RELEASE
August 8, 2016 NYSE American: REI

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

Midland, TX. August 8, 2016 – Ring Energy, Inc. (NYSE American: REI) (“Ring”)(“Company”) announced today financial results for the three months and six months ended June 30, 2016. For the three month period ended June 30, 2016, Ring had oil and gas revenues of $7,104,609, compared to $8,976,790 for the quarter ended June 30, 2015. For the six month period ended June 30, 2016, the Company reported oil and gas revenues of $13,196,997, compared to oil and gas revenues of $15,022,491 for the six month period ended June 30, 2015. For the second quarter of 2016, Ring reported a net loss of $15,941,500, or $0.41 per diluted share, which included a pre-tax non-cash impairment of $25,451,988. Excluding the impairment, the net loss per diluted share would have been $0.00. For the six months ended June 30, 2016, the Company reported a net loss of $31,216,544, or $0.90 per diluted share, which included a pre-tax non-cash impairment of $46,864,074. Excluding the impairment, the net loss per diluted share would have been $0.05. This information compares to net income of $534,167, or $0.02 per fully diluted share, for the three months ended June 30, 2015, and a net loss for the six month period ended June 30, 2015 of $441,457, or $0.02 per fully diluted share.

For the three months ended June 30, 2016, oil sales volume decreased to 160,925 barrels, compared to 165,759 barrels for the same period in 2015, a 3% decrease, and gas sales volume increased to 201,992 MCF (thousand cubic feet), compared to 94,517 MCF for the same period in 2015, a 114% increase. For the six months ended June 30, 2016, oil sales volume increased to 352,303 barrels, compared to 302,848 barrels for the same period in 2015, a 16% increase and gas sales volume increased to 458,740 MCF, compared to 114,364 MCF for the same period in 2015, a 301% increase.

The average commodity prices received by Ring were $41.22 per barrel of oil and $2.33 per MCF of natural gas for the quarter ended June 30, 2016, compared to $52.52 per barrel of oil and $2.87 per MCF of natural gas for the quarter ended June 30, 2015. The average prices received for the six months ended June 30, 2016 were $34.69 per barrel of oil and $2.13 per MCF of natural gas, compared to $48.55 per barrel of oil and $2.78 per MCF of natural gas for the six month period ended June 30, 2015.

Lease operating expenses, including production taxes, for the three months ended June 30, 2016 were $13.07 per barrel of oil equivalent (“BOE”), a 10% decrease from the prior year. Depreciation, depletion and amortization costs, including accretion, decreased 23% to $13.90 per BOE. General and administrative costs, which included a $507,642 charge for stock based compensation, were $9.87 per BOE, a 12% decrease. For the six months ended June 30, 2016, lease operating expenses, including production taxes, were $12.44 per BOE, a 16% decrease. Depreciation, depletion and amortization costs, including accretion, were $14.48 per BOE, a 33% decrease, and general and administrative costs, which included a $1,091,967 charge for stock based compensation, were $9.66 per BOE, an 18% decrease from 2015.

Cash provided by operating activities, before changes in working capital, for the three and six months ended June 30, 2016 was $3,135,349, or $0.08 per fully diluted share, and $4,389,664, or $0.13 per fully diluted share, compared to $4,881,602 and $7,708,958, or $0.18 and $0.30 per fully diluted share for the same periods in 2015. Earnings before interest, taxes, depletion and other non-cash items (“Adjusted EBITDA”) for the three and six months ended June 30, 2016 was $3,147,720, or $0.08 per fully diluted share, and $4,814,656, or $0.14 per fully diluted share, compared to $4,960,605 and $7,787,181, or $0.18 and $0.30 in 2015. (See accompanying table for a reconciliation of net income to adjusted EBITDA).

In April 2016, the Company received approximately $61 million in net proceeds from the public sale of 11,500,000 shares of the Company’s registered common stock. In May, the immediate borrowing base on the Company’s $500 million senior credit facility was reduced from $100 million to $60 million. There was no outstanding debt on the Company’s $500 million senior secured credit facility at June 30, 2016.

Internal estimates of net 3P reserves (Proved, Probable and Possible) were 25.796 million barrel of oil equivalents (BOE) Proved, 11.831 million BOE Probable, and 2.655 million BOE Possible for a 3P total of 40.282 million BOE. Future net revenues before income taxes, discounted at 10% (“PV-10”), based on NYMEX strip prices as of July 1, 2016, were $300.03 million Proved, $109.471 million Probable and $32.956 million Possible for a 3P total of $442.457 million.

Ring’s Chief Executive Officer, Mr. Kelly Hoffman, stated, “In the second quarter we continued to work extremely hard at reducing our operating costs and general overhead while maximizing our production. We drilled three new developmental wells, two on our Central Basin Platform and one on our Delaware Basin asset, and refraced two existing wells operating on the Central Basin properties. All of these were done toward the end of the quarter and unfortunately had no impact on the quarter’s production. We have continued to improve and upgrade our infrastructures on both the Central Basin Platform and the Delaware Basin assets. In April, we completed a public stock offering which allowed us to pay off the entire outstanding balance on our senior credit facility and put together a capital expenditure budget for the remainder of 2016. We have budgeted the drilling of eight vertical wells, one in the first quarter, three in the second quarter, three more in the third quarter and one in the fourth quarter. Along with the new vertical wells, we are excited to announce we have commenced drilling the first of three horizontal wells to be drilled in 2016 on our Central Basin property. We are hopeful commodity prices will improve. In the event that prices remain low, we have no long term debt and have positioned the Company to be able to take advantage of any acquisition opportunities that meet our requirements and compliment our existing acreage.”

Non-GAAP Financial Measures:

Net loss for the three months ended June 30, 2016 includes a non-cash charge for stock based compensation of $507,642, and a ceiling test impairment charge of $25,451,988. Excluding such items, the Company’s net earnings would have been $0.01 per diluted share. Net loss for the six months ended June 30, 2016 includes a non-cash charge for stock based compensation of $1,091,967, and a ceiling test impairment charge of $46,864,074. Excluding such items, the Company’s net loss would have been $0.03 per diluted share. 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
June 30,
Six Months Ended
June 30,
  2016
(Unaudited)
2015
(Unaudited)
2016
(Unaudited)
2015
(Unaudited)
Oil and Gas Revenues
$ 7,104,609 $ 8,976,790 $ 13,196,997 $ 15,022,491
     
Cost and Operating Expenses
   
     Oil and gas production costs 2,200,109 2,206,057 4,690,543 4,073,852
     Oil and gas production taxes 344,935 422,884 643,306 699,915
     Depreciation, depletion and amortization 2,579,201 3,205,033 5,973,828 6,859,331
     Ceiling test impairment 25,451,988 46,864,074
     Accretion expense 124,976 79,400 234,354 146,379
     General and administrative expense 1,920,387 2,043,730 4,140,459 3,772,717
     
     Total Costs and Operating Expenses 32,620,696 7,957,104 62,546,564 15,552,194
         
     Income (Loss) from Operations (25,516,087) 1,019,686 (49,349,567) (529,703)
     
Other Income    
     Interest income (86,538) (79,005) (502,046) (70,005)
     Interest expense 74,166 2 77,053 782
     
     Net Other Income (12,372) (79,003) (424,993) (78,223)
     
     Income (Loss) Before Provision for Income Taxes (25,528,459) 940,683 (49,774,560) (607,926)
     
(Provision For) Benefit From Income Taxes 9,586,959 (406,516) 18,558,016 166,469
     
Net Income (Loss) ($ 15,941,500) $ 534,167 ($ 31,216,544) ($ 441,457)
     
Basic Earnings (Loss) Per Common Share ($0.41) $0.02 ($0.90) ($0.02)
Diluted Earnings (Loss) Per Common Share ($0.41) $0.02 ($0.90) ($0.02)
         
Basic Weighted-Average Common Shares Outstanding 38,625,307 26,121,822 34,509,833 25,935,204
Diluted Weighted-Average Common Shares Outstanding 38,625,307 26,121,822 34,509,833 25,935,204
     

RING ENERGY, INC.
COMPARATIVE OPERATING STATISTICS
    Three Months Ended June 30,
    2016
2015
Change
Net Production - BOE per day
  2,138 1,995 7%
Per BOE:    
     Average Sales Price   $ 36.51 $ 49.46 -26%
             
     Lease Operating Expenses   $ 11.31 $ 12.15 -7%
     Production Taxes   $ 1.76 $ 2.33 -24%
     DD&A   $ 13.25 $ 17.66 -25%
     Accretion   $ 0.65 $ 0.44 45%
     General and Administrative Expenses   $ 9.87 $ 11.26 -12%
    Six Months Ended June 30,
    2016 2015 Change
Net Production - BOE per day   2,356 1,779 32%
Per BOE:        
     Average Sales Price   $ 30.78 $ 46.67 -34%
         
     Lease Operating Expenses   $ 10.94 $ 12.66 -14%
     Production Taxes   $ 1.50 $ 2.17 -31%
     DD&A   $ 13.93 $ 21.31 -35%
     Accretion   $ 0.55 $ 0.45 22%
     General and Administrative Expenses   $ 9.66 $ 11.72 -18%
 
Net Oil and Gas Reserves*
As of June 30, 2016
  Crude Oil
(MMBbls)

Nat. Gas
(MMcf)

Total
(MMBOE)
PV-10
(MM$)
Proved Developed Reserves 4.91 10.398 6.643 85.893
Proved Developed Non-Producing 0.266 0.037 0.272 5.632
Proved Undeveloped Reserves 18.08 4.803 18.881 208.505
Total Proved Reserves 23.256 15.238 25.796 300.03
Total Probable Reserves 9.721 12.66 11.831 109.471
Total Possible Reserves 2.313 2.054 2.655 32.956
Total 3P Reserves 35.29 29.952 40.282 442.457
         
* Note: Internal estimates based on NYMEX strip prices as of July 1, 2016        

RING ENERGY, INC.
CONSOLIDATED BALANCE SHEET
June 30,
2016
December 31,
2015
ASSETS
   
Current Assets
   
     Cash $ 8,328,712 $ 4,431,350
     Accounts receivable 2,919,015 2,507,858
     Joint interest billing receivable 800,398 1,629,165
     Prepaid expenses and retainers 422,180 146,118
     Total Current Assets 12,470,305 8,714,491
Property and Equipment, Using Full Cost Accounting    
     Oil and Gas properties subject to amortization 231,234,309 269,590,374
     Office equipment and automobiles 1,539,991 1,539,991
        Total Property and Equipment 232,774,300 271,130,365
     Accumulated depreciation, depletion and amortization (35,837,666) (29,863,838)
     Net Property and Equipment 196,936,634 241,266,527
Deferred Income Taxes 18,622,338 64,323
Deferred Financing Costs 541,367 820,904
Total Assets $ 228,570,644 $ 250,866,245
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Current Liabilities    
     Accounts payable $ 3,554,577 $ 11,023,269
     Other accrued liabilities 309,898
     Total Current Liabilities 3,554,577 11,333,167
     Long term debt 45,900,000
     Asset retirement obligation 7,722,019 7,401,950
     Total Liabilites 11,276,596 64,635,117
     
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;
   
     41,917,061 shares and 30,391,942 shares
     outstanding, respectively
41,917 30,392
     Additional paid-in capital 255,536,973 193,269,034
     Retained Loss (38,284,842) (7,068,298)
     Total Stockholders' Equity 217,294,048 186,231,128
Total Liabilities and Stockholders' Equity $ 228,570,644 $ 250,866,245

RING ENERGY, INC.
STATEMENTS OF CASH FLOW
   
  Six Months Ended
June 30,
 
2016
2015
Cash Flows From Operating Activities
   
     Net Loss ($ 31,216,544) ($ 441,457)
     Adjustments to reconcile net loss to net cash
     used in operating activities:
   
       Depreciation, depletion and amortization 5,973,828 3,654,298
       Ceiling test impairment 46,864,074
       Accretion expense 234,354 66,979
       Shared-based compensation 1,091,967 654,688
       Deferred income tax benefit (18,558,015) (572,985)
       Changes in assets and liabilities:    
       Accounts receivable 417,610 445,438
       Prepaid expenses 3,475 10,869
       Accounts payable (7,778,590) (9,332,248)
Net Cash Provided by (Used in) Operating Activities (2,967,841) (6,048,585)
Cash Flows from Investing Activities    
     Payments to purchase oil and natural gas properties (1,804,590) (954,458)
     Payments to develop oil and natural gas properties (6,616,360) (8,667,163)
     Purchase of office equipment (164,404)
     Plugging and abandonment cost incurred (1,344)
     Net Cash Used in Investing Activities (8,422,294) (9,786,025)
Cash Flows from Financing Activities    
     Proceeds from issuance of common stock 61,074,997 10,000,000
     Proceeds from issuance of notes payable 5,000,000  
     Principal payments on revolving line of credit (50,900,000)  
     Proceeds from option exercise 112,500 62,500
Net Cash Provided by Financing Activities 15,287,497 10,062,500
Net Decrease in Cash 3,897,362 (5,772,110)
Cash at Beginning of Period 4,431,350 8,622,235
Cash at End of Period $ 8,328,712 $ 2,850,125
     
Supplemental Cash Flow Information    
     Cash paid for interest $468,777
     
Non-Cash Investing and Financing Activities    
     Asset retirement obligation acquired $ 2,177,110
     Asset retirement obligation incurred during development 87,059 45,007
     
RECONCILIATION OF CASH FLOW FROM OPERATIONS
Net cash provided by operating activities ($ 2,967,841) ($ 2,917,656)
Change in operating assets and liabilities 7,357,505 10,626,614
     
Cash flow from operations $ 4,389,664 $ 7,708,958
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
 
  Six Months Ended
 
June 30,
2016
June 30,
2015
NET INCOME
($ 31,216,544) ($ 441,457)
     
     Interest (income) (77,053) (782)
     Interest expense 502,046 79,005
     Interest tax expense (benefit) (18,558,016) (166,469)
     Depreciation, depletion and amortization 5,973,828 6,859,331
     Accretion of discounted liabilities 234,354 146,379
     Ceiling test impairment 46,864,074
     Shared-based compensation 1,091,967 1,311,174
     
ADJUSTED EBITDA $ 4,814,656 $ 7,787,181


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, 2014, its Form 10-Q for the quarter ended March 31, 2015 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 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
 
 
 

 
   
   

HOME • INVESTORSPRESENTATIONSCAREERS • CONTACTDISCLOSURE • TERMS

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.

   
   

 

© Copyright 2012-2017 Ring Energy, Inc. All Rights Reserved