HOUSTON, May 21, 2019 /PRNewswire/ -- Yuma Energy,
Inc. (NYSE American: YUMA) ("Yuma" or the "Company," "we" or
"our") announced today that on May 20,
2019, it filed its quarterly report on Form 10-Q for the
three months ended March 31, 2019
with the Securities and Exchange Commission ("SEC").
Investors and stockholders may obtain our Form 10-Q, Form
10-K and other documents filed with the SEC free of charge at the
SEC's website, www.sec.gov. In addition, copies of our filings are
available on our website at www.yumaenergyinc.com.
Recent Developments
On April 26, 2018, the Company closed
the previously announced sale of our California assets for $2.1 million, resulting in net proceeds of
$1.8 million. Approximately
$1.2 million was applied against the
principal of our outstanding debt, and the balance ($0.6 million) provided working capital to the
Company.
On March 1, 2019, Mr. Anthony C. Schnur was appointed Chief
Restructuring Officer, and on March 28,
2019, he was appointed Interim Chief Executive Officer of
the Company following the departure of Mr. Sam L. Banks. On April 5, 2019, Mr. Schnur was further appointed
Interim Chief Financial Officer in addition to his other
duties. As reported, Mr. Schnur will not receive any
additional compensation for the incremental duties.
The Company believes that with the leadership and management of
Mr. Schnur, it has the requisite experience and expertise in place
to affect a restructuring of its business operations and its
balance sheet; however, significant uncertainty exists as to the
viability of a restructuring and the Company's ability to continue
as a going concern.
During the first quarter and continuing to date, the Company has
taken significant steps to reduce corporate overhead. These
reductions will be reflected in the Company's second quarter
results. Additional cost cutting measures are being
considered and will be implemented when determined that those
reductions will not impair the Company's ability to reasonably
manage the business.
In addition, the Company is conducting a comprehensive review of
its operations, particularly regarding those wells and facilities
with high operating costs. Funds allocated to field work will
be directed toward those activities that provide short payback
periods, maintain production levels, or provide additional
production from higher margin operations. We do not
anticipate our activities will include expensive workovers or the
drilling of new wells through the restructuring process.
Multiple options to restructure the Company are being
investigated and pursued. These include, but are not limited
to, restructuring the Company's credit facility, which may involve
the sale of our existing commercial bank loan to a third party,
sales of additional properties, or acquisitions from or with a
financial sponsor to create a larger company with greater operating
activities. The Company is engaged in various discussions on
these fronts and continues to work with Seaport Global Securities
LLC, an investment banking firm, to advise the Company on its
strategic alternatives.
Please refer to our recently filed Quarterly Report on Form
10-Q for the three months ended March 31,
2019 and our Annual report on Form 10-K for the year ended
December 31, 2018, and all our
filings with the SEC for further information.
Management Comments
Mr. Anthony C. Schnur, Interim Chief Executive
Officer and Chief Restructuring Officer stated, "We are acting
swiftly and diligently to identify an actionable restructuring
solution to better position the Company for the future benefit of
all stakeholders. We are committed to this process and
pursuing a strategy and resulting transaction which may include
additional asset sales, one or more acquisitions, restructured debt
facilities, equity financings and/or a corporate merger. We
believe that a successful resolution to Yuma's financial
circumstances will require not only improving cash flow margins,
but a likely blend of debt refinancing and asset combinations."
Continuing Uncertainty
The Company's audited
consolidated financial statements for the year ended December 31, 2018, included a going concern
qualification. The risk factors and uncertainties described
in our SEC filings for the year ended December 31, 2018 and the quarter ended
March 31, 2019, as well as
continuing events of default under our credit agreement, and our
substantial working capital deficit of approximately $40.0 million as of March
31, 2019, including approximately $34.0 million of bank debt, continue to raise
substantial doubt about the Company's ability to continue as a
going concern.
Other Matters
Finally, as previously reported, the
Company received a deficiency letter from the NYSE American stock
exchange ("NYSE American") indicating the Company's common stock
has been selling for a low price per share for a substantial period
of time, and the Company must demonstrate an improved share price
or effect a reverse stock split of its common stock by no later
than July 4, 2019, in order to
maintain the listing of the Company's common stock on the NYSE
American. The Company could be subject to immediate de-listing
should the stock price decline to $0.06. The NYSE American notification of
continued listing deficiency does not affect the Company's business
operations or its SEC reporting obligations. At present, the
Company intends to affect a reverse stock split to maintain its
listing, pending the approval of our shareholders at our annual
meeting scheduled for June 12, 2019.
About Yuma Energy, Inc.
Yuma Energy, Inc., a
Delaware corporation, is an
independent Houston-based
exploration and production company focused on acquiring, developing
and exploring for conventional and unconventional oil and natural
gas resources. Historically, the Company's activities have
focused on inland and onshore properties, primarily located in
central and southern Louisiana and
southeastern Texas. Its common stock is listed on the
NYSE American under the trading symbol "YUMA."
Forward-Looking Statements
This release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended (the "Securities Act"), and
Section 21E of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Any and all statements that are not strictly
historical statements constitute forward-looking statements and may
often, but not always, be identified by the use of such words such
as "expects," "believes," "intends," "anticipates," "plans,"
"estimates," "potential," "possible," or "probable" or statements
that certain actions, events or results "may," "will," "should," or
"could" be taken, occur or be achieved. The Company's annual
report on Form 10-K for the year ended December 31, 2018, quarterly reports on Form
10-Q, recent current reports on Form 8-K, and other SEC filings
discuss some of the important risk factors identified that may
affect its business, results of operations, and financial
condition. The Company undertakes no obligation to revise or
update publicly any forward-looking statements, except as required
by law.
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SOURCE Yuma Energy, Inc.