OKLAHOMA CITY, Feb. 5, 2020 /PRNewswire/ -- PANHANDLE OIL AND
GAS INC., "Panhandle" or the "Company," (NYSE: PHX), today reported
financial and operating results for the first quarter ended
Dec. 31, 2019.
Chad L. Stephens, CEO, commented,
"Please find herein the results reflected in our first quarter 2020
financials. We continue to make progress in our transition to a
minerals- and royalty-focused company despite the current
challenges created by depressed natural gas prices. We closed on
the purchase of our previously announced $9.3 million mineral acquisition in the core of
the STACK, mostly funded with cash from our like-kind exchanges. We
continue to evaluate opportunities in the liquids-rich areas of the
STACK/SCOOP and Bakken. As we stated in our last earnings release,
the results from this strategy shift will not happen overnight, but
we continue to be confident that Panhandle is well positioned, with
an attractive asset base and a resilient balance sheet, to succeed
in generating incremental value for our shareholders"
SUMMARY OF RESULTS FOR THE PERIOD ENDED DEC. 31, 2019, AND SUBSEQUENT EVENTS
- Net income was $1.9 million or
$0.11 per share in fiscal year 2020,
as compared to net income of $12.7
million or $0.75 per share in
fiscal 2019.
- Adjusted pre-tax net income(1) in fiscal 2020 was
$3.9 million or $0.23 per share, as compared to $10.1 million or $0.60 per share in fiscal 2019.
- Adjusted EBITDA(1) in fiscal 2020 was $7.2 million, as compared to $14.5 million in 2019, including $3.3 and $9.1
million gains on asset sales in the adjusted EBITDA for the
2020 and 2019 periods, respectively.
- Reduced debt from $35.4 million,
as of Sept. 30, 2019, to $35.0 million, as of Dec.
31, 2019. Net debt has been further reduced to approximately
$33.75 million as of Feb. 5, 2020.
- Debt to adjusted EBITDA (TTM) ratio was 1.16x at Dec. 31, 2019.
- Sale of 530 net mineral acres in Eddy
County, N.M., for $3.4 million
was closed by Panhandle on Nov. 14,
2019.
- Purchase of 700 net mineral acres in Kingfisher, Canadian and Garvin Counties, Okla., was closed by
Panhandle on Dec. 18, 2019, for a
purchase price of $9.3 million (after
normal closing adjustments). This purchase was primarily funded
with cash from our like-kind exchange sales.
(1) This is a non-GAAP measure. Refer to
the Non-GAAP Reconciliation section.
OPERATING HIGHLIGHTS
|
First Quarter
Ended
|
|
|
First Quarter
Ended
|
|
|
Dec. 31,
2019
|
|
|
Dec. 31,
2018
|
|
Mcfe Sold
|
|
2,278,487
|
|
|
|
2,764,530
|
|
Average Sales Price
per Mcfe
|
$
|
3.33
|
|
|
$
|
4.42
|
|
Oil Barrels
Sold
|
|
65,880
|
|
|
|
82,828
|
|
Average Sales Price
per Barrel
|
$
|
52.60
|
|
|
$
|
54.08
|
|
Gas Mcf
Sold
|
|
1,647,827
|
|
|
|
1,893,990
|
|
Average Sales Price
per Mcf
|
$
|
2.13
|
|
|
$
|
3.31
|
|
NGL Barrels
Sold
|
|
39,230
|
|
|
|
62,262
|
|
Average Sales Price
per Barrel
|
$
|
15.67
|
|
|
$
|
23.37
|
|
FINANCIAL HIGHLIGHTS
|
|
First Quarter
Ended
|
|
|
First Quarter
Ended
|
|
|
|
Dec. 31,
2019
|
|
|
Dec. 31,
2018
|
|
Working Interest Sales
|
|
$
|
4,684,737
|
|
|
$
|
7,444,278
|
|
Royalty Interest Sales
|
|
$
|
2,909,101
|
|
|
$
|
4,766,441
|
|
Oil, NGL and Natural
Gas Sales
|
|
$
|
7,593,838
|
|
|
$
|
12,210,719
|
|
|
|
|
|
|
|
|
|
|
Lease Bonuses and
Rental Income
|
|
$
|
527,699
|
|
|
$
|
514,557
|
|
Total
Revenue
|
|
$
|
10,576,531
|
|
|
$
|
26,328,994
|
|
|
|
|
|
|
|
|
|
|
LOE per
Mcfe
|
|
$
|
1.13
|
|
|
$
|
1.12
|
|
Production Tax per
Mcfe
|
|
$
|
0.14
|
|
|
$
|
0.22
|
|
G&A Expense per
Mcfe
|
|
$
|
0.98
|
|
|
$
|
0.70
|
|
Interest Expense per
Mcfe
|
|
$
|
0.16
|
|
|
$
|
0.20
|
|
DD&A per
Mcfe
|
|
$
|
1.30
|
|
|
$
|
1.38
|
|
Total Expense per
Mcfe
|
|
$
|
3.71
|
|
|
$
|
3.62
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
1,892,114
|
|
|
$
|
12,735,940
|
|
Adj. Pre-Tax Net
Income (Loss) (1)
|
|
$
|
3,865,781
|
|
|
$
|
10,100,759
|
|
Adjusted EBITDA
(1)
|
|
$
|
7,192,147
|
|
|
$
|
14,453,815
|
|
|
|
|
|
|
|
|
|
|
Cash Flow from
Operations
|
|
$
|
2,098,441
|
|
|
$
|
4,009,743
|
|
CapEx - Drilling
& Completing
|
|
$
|
105,265
|
|
|
$
|
1,445,939
|
|
CapEx - Mineral
Acquisitions
|
|
$
|
10,172,594
|
|
|
$
|
423,000
|
|
|
|
|
|
|
|
|
|
|
Borrowing
Base
|
|
$
|
70,000,000
|
|
|
$
|
80,000,000
|
|
Debt
|
|
$
|
35,000,000
|
|
|
$
|
41,500,000
|
|
Debt/Adjusted EBITDA
(TTM) (1)
|
|
|
1.16
|
|
|
|
1.27
|
|
|
|
(1)
|
This is a non-GAAP
measure. Refer to the Non-GAAP Reconciliation section.
|
FIRST QUARTER 2020 RESULTS
Oil, NGL and natural gas revenue decreased 38% in the 2020
quarter as production decreased 18% and product prices decreased
25% relative to the 2019 quarter. The 2020 quarter included a
$0.8 million loss on derivative
contracts as compared to a $4.5
million gain for the 2019 quarter.
Total production decreased 18% in the 2020 quarter, as compared
to the 2019 quarter. Total production decreased due to the natural
decline of the production base and, to a lesser extent, the result
of non-core marginal property divestitures in 2019 and 2020. This
decrease was partially offset by the production from new royalty
wells completed and/or acquired. The oil production decrease is a
result of naturally declining production in the Eagle Ford Shale
and STACK and mineral sales in Martin
County, Texas, and Lea and
Eddy Counties, N.M. These
decreases were partially offset by seven new wells in the Eagle
Ford that began producing in third quarter 2019 and by mineral
acquisitions in the Bakken. NGL production decrease is attributed
to natural production decline and operators electing to remove less
NGL from the natural gas stream due to lower NGL prices and, to a
lesser extent, the sale of minerals in New Mexico. Decreased natural gas production
is due to naturally declining production in the Anadarko STACK,
Arkoma Stack and Fayetteville Shale.
In the first quarter of 2020, the Company sold 530 net mineral
acres in Eddy County, N.M, for
$3.4 million. At the time of sale,
the assets were mostly amortized and therefore had minimal net book
value. Almost all of the value received was a gain on the sale of
assets ($3.3 million) in the first
quarter of 2020. In the 2019 quarter, the Company sold
mineral acreage in Lea and
Eddy Counties, N.M., for a gain of
$9.1 million.
The 2.5% increase in total cost per Mcfe in the 2020 quarter,
relative to the 2019 quarter was primarily driven by higher
G&A, partially offset by lower DD&A, interest expenses and
production taxes as noted above. The G&A expense increase was
primarily the result of higher technical consulting, legal expenses
and timing of billings of work performed by outside firms. The
increase in technical consulting was due to increased cost for
geologic and engineering fees. The increase in legal was primarily
due to additional work provided pertaining to the Company's
strategy change.
The DD&A rate decrease was mainly due to the impairment
taken on the Eagle Ford at the end of fiscal 2019, which lowered
the basis of the assets. The rate decrease was partially offset by
lower oil, NGL and natural gas prices utilized in the reserve
calculations during the 2020 quarter, as compared to the 2019
quarter, shortening the economic life of wells. This resulted
in lower projected remaining reserves on a significant number of
wells causing increased units of production DD&A.
The interest rate decrease was mainly attributable to lower
average outstanding debt balance during the 2020 quarter as
compared to the 2019 quarter. The decrease in production tax rate
was primarily due to lower product prices during the 2020 quarter.
The Company's net income decreased from net income of
$12.7 million in the 2019 quarter to
net income of $1.9 million in the
2020 quarter. The majority of the decrease was due to the decreased
production, lower oil, NGL and natural gas prices and decreased
gains on assets sales and derivative contracts. Pretax net income
(loss) without gain on asset sales and gains (losses) on derivative
contracts would have been ($308,880)
and $2,703,222 for 2020 and 2019,
respectively. Adjusted pretax net income(1) was
$3.9 million in the 2020 quarter, as
compared to $10.1 million in the 2019
quarter.
(1) This is a non-GAAP measure. Refer to
the Non-GAAP Reconciliation section.
OPERATIONS UPDATE
During the quarter ended Dec. 31,
2019, we converted 97 gross/0.32 net wells in progress to
producing wells. Our inventory of wells in progress increased to
125 gross wells but decreased on a net well basis to 0.49 wells, as
new drilling occurred on acreage where we have a lower ownership
stake. Permits outstanding decreased as permits were converted to
wells in progress and operator permitting activity slowed during
the quarter.
|
|
|
|
|
|
Bakken/
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SCOOP/
|
|
|
Three
|
|
|
Arkoma
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STACK
|
|
|
Forks
|
|
|
Stack
|
|
|
Permian
|
|
|
Fayetteville
|
|
|
Other
|
|
|
Total
|
|
Gross Wells in
Progress on PHX Acreage:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of
9/30/19
|
|
|
54
|
|
|
|
11
|
|
|
|
19
|
|
|
|
7
|
|
|
|
-
|
|
|
|
29
|
|
|
|
120
|
|
Net Change
|
|
|
25
|
|
|
|
-9
|
|
|
|
-8
|
|
|
|
-2
|
|
|
|
-
|
|
|
|
-1
|
|
|
|
5
|
|
As of
12/31/19
|
|
|
79
|
|
|
|
2
|
|
|
|
11
|
|
|
|
5
|
|
|
|
-
|
|
|
|
28
|
|
|
|
125
|
|
Net Wells in Progress
on PHX Acreage:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of
9/30/19
|
|
|
0.16
|
|
|
|
0.02
|
|
|
|
0.03
|
|
|
|
0.25
|
|
|
|
-
|
|
|
|
0.18
|
|
|
|
0.64
|
|
Net Change
|
|
|
0.03
|
|
|
|
-0.02
|
|
|
|
-0.01
|
|
|
|
-0.10
|
|
|
|
-
|
|
|
|
-0.05
|
|
|
|
-0.15
|
|
As of
12/31/19
|
|
|
0.19
|
|
|
|
-
|
|
|
|
0.02
|
|
|
|
0.15
|
|
|
|
-
|
|
|
|
0.13
|
|
|
|
0.49
|
|
Gross Active Permits
on PHX Acreage:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of
9/30/19
|
|
|
24
|
|
|
|
16
|
|
|
|
4
|
|
|
|
19
|
|
|
|
-
|
|
|
|
9
|
|
|
|
72
|
|
Net Change
|
|
|
11
|
|
|
|
-3
|
|
|
|
2
|
|
|
|
-19
|
|
|
|
-
|
|
|
|
2
|
|
|
|
-7
|
|
As of
12/31/19
|
|
|
35
|
|
|
|
13
|
|
|
|
6
|
|
|
|
-
|
|
|
|
-
|
|
|
|
11
|
|
|
|
65
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of
12/31/19:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rigs Present on PHX
Acreage
|
|
|
8
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1
|
|
|
|
9
|
|
Rigs Within 2.5 Miles
of PHX Acreage
|
|
|
33
|
|
|
|
7
|
|
|
|
4
|
|
|
|
1
|
|
|
|
-
|
|
|
|
10
|
|
|
|
55
|
|
Leasing Activity
During the first quarter of fiscal 2020, Panhandle leased 754
net mineral acres for an average bonus payment of $668 per net mineral acre and an average royalty
of 21%.
|
|
|
|
|
Bakken/
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SCOOP/
|
|
Three
|
|
Arkoma
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STACK
|
|
Forks
|
|
Stack
|
|
Permian
|
|
Fayetteville
|
|
Other
|
|
Total
|
|
During Quarter Ended
12/31/19:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Mineral Acres
Leased
|
|
|
96
|
|
|
-
|
|
|
53
|
|
|
388
|
|
|
-
|
|
|
217
|
|
|
754
|
|
Average Bonus per Net
Mineral Acre
|
|
$
|
1,178
|
|
|
-
|
|
$
|
250
|
|
$
|
475
|
|
|
-
|
|
$
|
606
|
|
$
|
668
|
|
Average Royalty per
Net Mineral Acre
|
|
21%
|
|
|
-
|
|
19%
|
|
25%
|
|
|
-
|
|
20%
|
|
21%
|
|
Eagle Ford Activity
Consistent with Panhandle's strategy to focus solely on minerals
and royalties, the Company has received four proposals to
participate in new well drilling in the Eagle Ford and elected not
to participate on any of them.
ACQUISITION AND DIVESTITURE UPDATE
During the first quarter of fiscal 2020, Panhandle purchased 700
net mineral acres at an average price of $13,276 per acre and sold 530 net mineral acres
at an average price of $4,811 per
acre.
|
|
|
|
|
|
Bakken/
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SCOOP/
|
|
|
Three
|
|
|
Arkoma
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STACK
|
|
|
Forks
|
|
|
Stack
|
|
|
Permian
|
|
|
Fayetteville
|
|
|
Other
|
|
|
Total
|
|
During Quarter Ended
12/31/19:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Mineral Acres
Purchased
|
|
|
700
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
700
|
|
Price per Net
Mineral Acre
|
|
$
|
13,276
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
$
|
13,276
|
|
Net Mineral Acres
Sold
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
530
|
|
|
|
-
|
|
|
|
-
|
|
|
|
530
|
|
Price per Net
Mineral Acre
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
$
|
4,811
|
|
|
|
-
|
|
|
|
-
|
|
|
$
|
4,811
|
|
On Nov. 14, 2019, Panhandle closed
on the sale of 530 net mineral acres in Eddy County, N.M., for $3.4 million. At the time of the sale, the assets
were mostly amortized and therefore had minimal net book value.
Almost all of the value received was a gain on the sale of assets
($3.3 million) in the first quarter
of 2020. The Company utilized a like-kind exchange under IRS Code
1031 to defer income tax on all of the gain by offsetting it with
the STACK/SCOOP mineral acreage acquisition that was purchased
during the quarter using qualified exchange accommodation
agreements.
On Dec. 18, 2019, Panhandle closed
on the purchase of 700 net mineral acres in Kingfisher, Canadian and Garvin Counties, Oklahoma, for a purchase price of $9.3 million (after normal closing adjustments).
This purchase was mostly funded with cash from our like-kind
exchange sales.
BORROWING BASE
Subsequent to Dec. 31, 2019, the
borrowing base under the credit facility was redetermined on
Jan. 31, 2020, and reduced from
$70 million to $45 million. The drop in the borrowing base was
mostly due to the continued decline in natural gas futures prices.
To a lesser extent, the Company's strategic decision to cease
participating with a working interest going forward and the removal
of all working interest PUDs as of Sept. 30,
2019, also caused a reduction. Even though the borrowing
base was reduced, we do not expect that it will impact the
liquidity needed to maintain our normal operating strategies
(current availability of $11,250,000). Any acquisitions of minerals would
be funded with a combination of cash on hand, bank debt and equity.
Our current plan is to apply free cash flow in future quarters
toward debt reduction.
FIRST QUARTER EARNINGS CALL
Panhandle will host a conference call to discuss first quarter
results at 5:00 p.m. EST on
Feb. 5, 2020. Management's discussion
will be followed by a question and answer session with investors.
To participate on the conference call, please dial 844-407-9500
(domestic) or 862-298-0850 (international). A replay of the call
will be available for 14 days after the call. The number to access
the replay of the conference call is 877-481-4010 and the PIN for
the replay is 57231.
FINANCIALS
Statements of
Operations
|
|
|
Three Months Ended
Dec. 31,
|
|
|
2019
|
|
|
2018
|
|
Revenues:
|
(unaudited)
|
|
Oil, NGL and natural
gas sales
|
$
|
7,593,838
|
|
|
$
|
12,210,719
|
|
Lease bonuses and
rental income
|
$
|
527,699
|
|
|
$
|
514,557
|
|
Gains (losses) on
derivative contracts
|
$
|
(817,894)
|
|
|
$
|
4,506,780
|
|
Gain on asset
sales
|
$
|
3,272,888
|
|
|
$
|
9,096,938
|
|
|
|
10,576,531
|
|
|
|
26,328,994
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
Lease operating
expenses
|
$
|
2,564,672
|
|
|
$
|
3,104,570
|
|
Production
taxes
|
$
|
327,281
|
|
|
$
|
608,951
|
|
Depreciation,
depletion and amortization
|
$
|
2,955,701
|
|
|
$
|
3,813,686
|
|
Interest
expense
|
$
|
370,665
|
|
|
$
|
539,370
|
|
General and
administrative
|
$
|
2,223,028
|
|
|
$
|
1,938,840
|
|
Loss on asset sales
and other expense (income)
|
$
|
(10,930)
|
|
|
$
|
16,637
|
|
|
|
8,430,417
|
|
|
|
10,022,054
|
|
Income (loss) before
provision (benefit) for income taxes
|
|
2,146,114
|
|
|
|
16,306,940
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
$
|
254,000
|
|
|
$
|
3,571,000
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
1,892,114
|
|
|
$
|
12,735,940
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
earnings (loss) per common share
|
$
|
0.11
|
|
|
$
|
0.75
|
|
|
|
|
|
|
|
|
|
Basic and diluted
weighted average shares outstanding:
|
|
|
|
|
|
|
|
Common
shares
|
|
16,339,673
|
|
|
|
16,745,076
|
|
Unissued, directors'
deferred compensation shares
|
|
180,864
|
|
|
|
213,932
|
|
|
|
16,520,537
|
|
|
|
16,959,008
|
|
|
|
|
|
|
|
|
|
Dividends declared
per share of
|
|
|
|
|
|
|
|
common stock and paid
in period
|
$
|
0.04
|
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
Dividends declared
per share of
|
|
|
|
|
|
|
|
common stock and paid
in quarter ended March 31
|
$
|
0.04
|
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
Balance
Sheets
|
|
|
Dec. 31,
2019
|
|
|
Sept. 30,
2019
|
|
Assets
|
|
(unaudited)
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
268,707
|
|
|
$
|
6,160,691
|
|
Oil, NGL and natural
gas sales receivables (net of
allowance for uncollectable accounts)
|
|
4,321,486
|
|
|
|
4,377,646
|
|
Refundable income
taxes
|
|
1,917,515
|
|
|
|
1,505,442
|
|
Derivative contracts,
net
|
|
774,106
|
|
|
|
2,256,639
|
|
Other
|
|
776,672
|
|
|
|
177,037
|
|
Total current
assets
|
|
8,058,486
|
|
|
|
14,477,455
|
|
|
|
|
|
|
|
|
|
Properties and
equipment, at cost, based on
successful efforts accounting:
|
|
|
|
|
|
|
|
Producing oil and
natural gas properties
|
|
358,110,146
|
|
|
|
354,718,398
|
|
Non-producing oil and
natural gas properties
|
|
19,131,441
|
|
|
|
14,599,023
|
|
Other
|
|
1,731,037
|
|
|
|
1,722,080
|
|
|
|
378,972,624
|
|
|
|
371,039,501
|
|
Less accumulated
depreciation, depletion and amortization
|
|
(260,155,491)
|
|
|
|
(259,314,590)
|
|
Net properties and
equipment
|
|
118,817,133
|
|
|
|
111,724,911
|
|
|
|
|
|
|
|
|
|
Investments
|
|
202,172
|
|
|
|
205,076
|
|
Derivative contracts,
net
|
|
371
|
|
|
|
237,505
|
|
Total
assets
|
$
|
127,078,162
|
|
|
$
|
126,644,947
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
$
|
670,175
|
|
|
$
|
665,160
|
|
Accrued liabilities
and other
|
|
1,824,408
|
|
|
|
2,433,466
|
|
Total current
liabilities
|
|
2,494,583
|
|
|
|
3,098,626
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
35,000,000
|
|
|
|
35,425,000
|
|
Deferred income
taxes
|
|
6,634,007
|
|
|
|
5,976,007
|
|
Asset retirement
obligations
|
|
2,840,639
|
|
|
|
2,835,781
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
Class A voting common
stock, $0.01666 par value;
24,000,000 shares authorized; 16,897,306 issued
at Dec. 31,
2019, and at Sept. 30,
2019
|
|
281,509
|
|
|
|
281,509
|
|
Capital in excess of
par value
|
|
3,033,678
|
|
|
|
2,967,984
|
|
Deferred directors'
compensation
|
|
2,641,993
|
|
|
|
2,555,781
|
|
Retained
earnings
|
|
82,420,516
|
|
|
|
81,848,301
|
|
|
|
88,377,696
|
|
|
|
87,653,575
|
|
Less treasury stock,
at cost; 553,137 shares at Dec. 31,
2019, and 558,051 shares at Sept. 30,
2019
|
|
(8,268,763)
|
|
|
|
(8,344,042)
|
|
Total stockholders'
equity
|
|
80,108,933
|
|
|
|
79,309,533
|
|
Total liabilities and
stockholders' equity
|
$
|
127,078,162
|
|
|
$
|
126,644,947
|
|
Condensed Statements
of Cash Flows
|
|
|
Three months ended
Dec. 31,
|
|
|
2019
|
|
|
2018
|
|
Operating
Activities
|
(unaudited)
|
|
Net income
(loss)
|
$
|
1,892,114
|
|
|
$
|
12,735,940
|
|
Adjustments to
reconcile net income (loss) to net cash provided
by operating activities:
|
|
|
|
|
|
|
|
Depreciation,
depletion and amortization
|
|
2,955,701
|
|
|
|
3,813,686
|
|
Provision for deferred
income taxes
|
|
658,000
|
|
|
|
4,314,000
|
|
Gain from leasing of
fee mineral acreage
|
|
(523,384)
|
|
|
|
(514,557)
|
|
Proceeds from leasing
of fee mineral acreage
|
|
537,777
|
|
|
|
528,374
|
|
Net (gain) loss on
sale of assets
|
|
(3,272,888)
|
|
|
|
(9,096,938)
|
|
Directors' deferred
compensation expense
|
|
86,213
|
|
|
|
80,287
|
|
Fair value of
derivative contracts
|
|
1,719,667
|
|
|
|
(6,206,181)
|
|
Restricted stock
awards
|
|
148,515
|
|
|
|
159,469
|
|
Other
|
|
8,896
|
|
|
|
7,163
|
|
Cash provided (used)
by changes in assets and liabilities:
|
|
|
|
|
|
|
|
Oil, NGL and natural
gas sales receivables
|
|
56,160
|
|
|
|
(77,414)
|
|
Other current
assets
|
|
(407,610)
|
|
|
|
(261,308)
|
|
Accounts
payable
|
|
(73,831)
|
|
|
|
(2,971)
|
|
Income taxes
receivable
|
|
(412,073)
|
|
|
|
(754,153)
|
|
Other non-current
assets
|
|
1,090
|
|
|
|
28,899
|
|
Accrued
liabilities
|
|
(1,275,906)
|
|
|
|
(744,553)
|
|
Total
adjustments
|
|
206,327
|
|
|
|
(8,726,197)
|
|
Net cash provided by
operating activities
|
|
2,098,441
|
|
|
|
4,009,743
|
|
|
|
|
|
|
|
|
|
Investing
Activities
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
(105,265)
|
|
|
|
(1,445,939)
|
|
Acquisition of
minerals and overrides
|
|
(10,172,594)
|
|
|
|
(423,000)
|
|
Proceeds from sales of
assets
|
|
3,376,049
|
|
|
|
9,096,938
|
|
Net cash provided
(used) by investing activities
|
|
(6,901,810)
|
|
|
|
7,227,999
|
|
|
|
|
|
|
|
|
|
Financing
Activities
|
|
|
|
|
|
|
|
Borrowings under debt
agreement
|
|
4,774,297
|
|
|
|
3,832,557
|
|
Payments of loan
principal
|
|
(5,199,297)
|
|
|
|
(13,332,557)
|
|
Purchase of treasury
stock
|
|
(7,635)
|
|
|
|
(1,140,559)
|
|
Payments of
dividends
|
|
(655,980)
|
|
|
|
(673,892)
|
|
Net cash provided
(used) by financing activities
|
|
(1,088,615)
|
|
|
|
(11,314,451)
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in
cash and cash equivalents
|
|
(5,891,984)
|
|
|
|
(76,709)
|
|
Cash and cash
equivalents at beginning of period
|
|
6,160,691
|
|
|
|
532,502
|
|
Cash and cash
equivalents at end of period
|
$
|
268,707
|
|
|
$
|
455,793
|
|
|
|
|
|
|
|
|
|
Supplemental
Schedule of Noncash Investing and Financing
Activities
|
|
|
|
|
|
|
|
Dividends declared and
unpaid
|
$
|
663,919
|
|
|
$
|
673,897
|
|
Additions and
revisions, net, to asset retirement obligations
|
$
|
4
|
|
|
$
|
5,371
|
|
|
|
|
|
|
|
|
|
Gross additions to
properties and equipment
|
$
|
10,164,680
|
|
|
$
|
1,894,741
|
|
Net (increase)
decrease in accounts payable for properties
|
|
|
|
|
|
|
|
and equipment
additions
|
|
113,179
|
|
|
|
(25,802)
|
|
Capital expenditures
and acquisitions
|
$
|
10,277,859
|
|
|
$
|
1,868,939
|
|
Hedge Position as of
Feb. 5, 2020
|
|
Period
|
|
Product
|
|
Volume
Mcf/Bbl
|
|
|
Swap Price
|
|
|
Collar Average
Floor Price
|
|
|
Collar Average
Ceiling Price
|
|
2020
|
|
Natural
Gas
|
|
70,000
|
|
|
|
|
|
|
$
|
2.20
|
|
|
$
|
2.59
|
|
2020
|
|
Natural
Gas
|
|
990,000
|
|
|
$
|
2.75
|
|
|
|
|
|
|
|
|
|
2021
|
|
Natural
Gas
|
|
30,000
|
|
|
$
|
2.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
Crude Oil
|
|
42,000
|
|
|
|
|
|
|
$
|
58.57
|
|
|
$
|
66.56
|
|
2020
|
|
Crude Oil
|
|
100,000
|
|
|
$
|
58.01
|
|
|
|
|
|
|
|
|
|
Non-GAAP Reconciliation
This news release includes certain "non-GAAP financial measures"
under the rules of the Securities and Exchange Commission,
including Regulation G. These non-GAAP measures are calculated
using GAAP amounts in our financial statements.
Adjusted EBITDA Reconciliation
Adjusted EBITDA is defined as net income (loss) plus interest
expense, provision for impairment, depreciation, depletion and
amortization of properties and equipment, including amortization of
other assets, provision (benefit) for income taxes and unrealized
(gains) losses on derivative contracts. We have included a
presentation of adjusted EBITDA because we recognize that certain
investors consider adjusted EBITDA a useful means of measuring our
ability to meet our debt service obligations and evaluating our
financial performance. Adjusted EBITDA has limitations and should
not be considered in isolation or as a substitute for net income,
operating income, cash flow from operations or other consolidated
income or cash flow data prepared in accordance with GAAP. Because
not all companies use identical calculations, this presentation of
adjusted EBITDA may not be comparable to a similarly titled measure
of other companies. The following table provides a reconciliation
of net income (loss) to adjusted EBITDA for the periods
indicated.
|
First Quarter
Ended
|
|
|
First Quarter
Ended
|
|
|
Dec. 31,
2019
|
|
|
Dec. 31,
2018
|
|
Net Income
(Loss)
|
$
|
1,892,114
|
|
|
$
|
12,735,940
|
|
Plus:
|
|
|
|
|
|
|
|
Unrealized (gains)
losses on derivatives
|
|
1,719,667
|
|
|
|
(6,206,181)
|
|
Income Tax Expense (Benefit)
|
|
254,000
|
|
|
|
3,571,000
|
|
Interest Expense
|
|
370,665
|
|
|
|
539,370
|
|
DD&A
|
|
2,955,701
|
|
|
|
3,813,686
|
|
Adjusted
EBITDA
|
$
|
7,192,147
|
|
|
$
|
14,453,815
|
|
Adjusted Pre-Tax Net Income (Loss) Reconciliation
Adjusted pre-tax net income (loss) is defined as net income
(loss) plus provision (benefit) for income taxes and unrealized
(gains) losses on derivative contracts. We have included a
presentation of adjusted pre-tax net income (loss) because we
recognize that certain investors consider adjusted pre-tax net
income (loss) a useful means of evaluating our financial
performance. Adjusted pre-tax net income (loss) has limitations and
should not be considered in isolation or as a substitute for net
income, operating income, cash flow from operations or other
consolidated income or cash flow data prepared in accordance with
GAAP. Because not all companies use identical calculations, this
presentation of adjusted pre-tax net income (loss) may not be
comparable to a similarly titled measure of other companies. The
following table provides a reconciliation of net income (loss) to
adjusted pre-tax net income (loss) for the periods indicated.
|
First Quarter
Ended
|
|
|
First Quarter
Ended
|
|
|
Dec. 31,
2019
|
|
|
Dec. 31,
2018
|
|
Net Income
(Loss)
|
$
|
1,892,114
|
|
|
$
|
12,735,940
|
|
Impairment
|
|
-
|
|
|
|
-
|
|
Unrealized (gains)
losses on derivatives
|
|
1,719,667
|
|
|
|
(6,206,181)
|
|
Income Tax Expense (Benefit)
|
|
254,000
|
|
|
|
3,571,000
|
|
Adjusted Pre-Tax
Net Income (Loss)
|
$
|
3,865,781
|
|
|
$
|
10,100,759
|
|
Panhandle Oil and Gas Inc. (NYSE:
PHX) Oklahoma City-based, Panhandle Oil and Gas Inc.
is an oil and natural gas mineral company with a strategy to
proactively pursue the acquisition of additional minerals in our
core areas of focus. Panhandle owns approximately 258,000 net
mineral acres principally located in Oklahoma, North
Dakota, Texas, New Mexico and Arkansas. Approximately 71% of this mineral
count is unleased and undeveloped. Additional information on the
Company can be found at www.panhandleoilandgas.com.
Cautionary Statement Regarding Forward-Looking
Statements
This press release includes "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Words such as
"anticipates," "plans," "estimates," "believes," "expects,"
"intends," "will," "should," "may" and similar expressions may be
used to identify forward-looking statements. Forward-looking
statements are not statements of historical fact and reflect
Panhandle's current views about future events. Forward-looking
statements may include, but are not limited to, statements relating
to: our future financial and operating results; our ability to
execute our business strategies; estimations and the respective
values of oil, NGL and natural gas reserves; the level of
production on our properties and the future expenses associated
therewith; projections and volatility of future realized oil and
natural gas prices; planned capital expenditures associated with
our mineral, leasehold and non-operated working interests;
statements concerning anticipated cash flow and liquidity; and our
strategy and other plans and objectives for future operations.
Although Panhandle believes the expectations reflected in these and
other forward-looking statements are reasonable, we can give no
assurance they will prove to be correct. Such forward-looking
statements are subject to a number of assumptions, risks and
uncertainties, many of which are beyond the control of the Company.
These forward-looking statements involve certain risks and
uncertainties that could cause the results to differ materially
from those expected by the Company's management. Information
concerning these risks and other factors can be found in the
Company's filings with the Securities and Exchange Commission,
including its Annual Reports on Form 10-K and Quarterly Reports on
Form 10-Q, available on the Company's website or the SEC's website
at www.sec.gov.
Investors are cautioned that any such statements are not
guarantees of future performance and that actual results or
developments may differ materially from those projected in
forward-looking statements. The forward-looking statements in this
press release are made as of the date hereof, and the Company does
not undertake any obligation to update the forward-looking
statements as a result of new information, future events or
otherwise.
View original
content:http://www.prnewswire.com/news-releases/panhandle-oil-and-gas-inc-reports-first-quarter-2020-results-300999741.html
SOURCE PANHANDLE OIL AND GAS INC.