U.S. Energy Corp. (NASDAQ:USEG) (“U.S. Energy” or
the “Company”) today announced financial and operational results
for the quarter ended September 30, 2017.
Highlights
- Production of 42,637 BOE, or daily production of 463
BOEPD;
- Oil and gas revenue of $1.5 million;
- Lease operating expenses of $0.6 million;
- Adjusted EBITDA of $0.3 million;
- Cash and cash equivalents of $1.8 million at 9/30/2017;
Pro-forma cash balance of $3.8 million for previously announced
asset divestiture which closed in early October 2017; and
- Current shares outstanding of 5,983,498.
Management Comment
David Veltri, U.S. Energy’s Chief Executive
Officer, stated, “Over the course of 2017, U.S. Energy has either
completed transactions or entered into definitive agreements which
have allowed the Company to refinance its legacy credit facility,
potentially equitize a significant portion of its outstanding debt
and eliminate the majority of the Company’s outstanding
liabilities, all while significantly increasing the Company’s
liquidity profile. The results of these efforts will begin
immediately showing up on our 2017 year-end financial statements
and we expect to see continued improvements in both our operating
margins and profitability going forward. With both the
immediate cash received from these transactions and the future cash
savings due to a significantly reduced interest expense, U.S.
Energy is well positioned to deploy capital to create accretive
future growth for all shareholders during 2018 and beyond. To
that end, we intend to target significant acquisitions during the
coming year to increase our production as well as expand our
drilling inventory. As evidenced by our recently announced
participation in the horizontal drilling program targeting the
Georgetown formation on our South Texas acreage position, U.S.
Energy has transitioned itself into a growth-oriented E&P
company focused on returns on invested capital and maximizing
shareholder value.”
Third Quarter 2017
Production
For the third quarter of 2017, U.S. Energy’s
total production volumes on a BOE basis decreased as compared to
the second quarter of 2017, primarily driven by downtime due to
necessary maintenance on a specific producing well that the Company
holds a significant working interest in. The well was offline
for the majority of the quarter and was brought back online towards
the end of September 2017. Now back online and producing, the
Company expects the well to return to its forecasted production
profile. During the third quarter of 2017, U.S. Energy
realized a $36.07 average price per Bbl of oil compared to an
$34.13 average price per Bbl of oil during the second quarter of
2017.
|
|
3rd Quarter 2017 |
|
2nd Quarter 2017 |
Sales Volume
(Total) |
|
|
|
|
Oil (Bbls) |
|
30,000 |
|
36,004 |
Gas (Mcf) |
|
75,820 |
|
134,187 |
Sales volumes
(Boe) |
|
42,637 |
|
58,369 |
|
|
|
|
|
Average Sales
Prices |
|
|
|
|
Oil (Bbl) |
$ |
43.70 |
$ |
44.19 |
Gas (Mcf) |
$ |
2.99 |
$ |
2.99 |
Barrel of Oil
Equivalent |
$ |
36.07 |
$ |
34.13 |
Financial Results
Revenues from sales of oil and natural gas for
the second quarter of 2017 were $1.5 million compared to $2.0
million for the second quarter of 2017. The quarter over
quarter decrease in revenue is primarily due to production downtime
attributable to maintenance on a specific producing well that the
Company holds a significant working interest in. Revenue from oil
production represented 85% of Company revenue during the third
quarter of 2017.
Lease operating expenses for the third quarter
of 2017 were $0.6 million compared to $0.5 million for the second
quarter of 2017. This slight increase as compared to the second
quarter of 2017 was primarily due to workover costs associated with
maintenance on a portion of the Company’s producing
wells.
General and administrative expenses for the
third quarter of 2017 were $0.6 million compared to $1.0 million
for the second quarter in 2017. The quarter over quarter
decrease is primarily associated with a reduction in professional
fees associated with the assignment and transfer of the Company’s
Credit Facility.
Adjusted EBITDA was $0.3 million for the third
quarter of 2017, as compared to $0.4 million for the second quarter
of 2017. Net Income (Loss) was $(0.4) million for the third
quarter of 2017 compared to $0.3 million for the second quarter of
2017. Adjusted EBITDA is a non-GAAP financial measure.
For additional information please refer to the reconciliation of
this measure at the end of this news release.
Credit Facility Update
As of September 30, 2017, the Company was in
compliance with all financial covenants and fully confirming with
all requirements under its credit facility.
Credit Facility
Covenants |
|
Required Covenant Ratio |
|
U.S.
Energy at 9/30/2017* |
Current
Ratio |
|
Greater
than 1.0 to 1.0 |
|
7.9 to
1.0 |
PDP to Secured
Debt |
|
Greater
than 1.2 to 1.0 |
|
2.3 to
1.0 |
|
|
|
|
|
*Represents amounts
subject to calculation per Credit Agreement amendment |
|
|
|
|
|
|
|
|
|
As previously announced, on October 5, 2017,
U.S. Energy Corp. announced that the Company, the Company’s wholly
owned subsidiary Energy One LLC and APEG Energy II, L.P., (“APEG”),
an entity controlled by Angelus Private Equity Group, LLC entered
into an exchange agreement (the “Exchange Agreement”), pursuant to
which, on the terms and subject to the conditions of the Exchange
Agreement, APEG will exchange $4,463,380 of outstanding borrowings
under the Company’s Credit Facility, for 5,819,270 new shares of
common stock of the Company, par value $0.01 per share,
representing an exchange price of $0.767 representing a 1.3%
premium over the 30-day volume weighted average price of the
Company’s common stock on September 20, 2017 (the “Exchange
Shares”). Accrued, unpaid interest on the Credit Facility held by
APEG will be paid in cash at the closing of the transaction.
Immediately following the close of the transaction, APEG will hold
approximately 49.3% of the outstanding Common Stock of U.S. Energy.
The Company expects to close the Transaction in the fourth quarter
of 2017. The Transaction is subject to certain customary closing
conditions, including approval by the Company's shareholders of the
Transaction.
Update to Hedging Activity
U.S. Energy hedges portions of its expected
production volumes to increase the predictability of its cash flow
and to help maintain a strong financial position. The following
table summarizes U.S. Energy’s open crude oil and natural gas
derivative contracts scheduled to settle after September 30,
2017.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Begin |
|
|
End |
|
|
Quantity |
|
|
Price |
|
(bbls/d) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Crude
oil price swaps |
|
|
10/1/2017 |
|
|
|
12/31/2017 |
|
|
|
300 |
|
|
$ |
52.4 |
|
|
|
|
1/1/2018 |
|
|
|
6/30/2018 |
|
|
|
150 |
|
|
|
52.2 |
|
|
|
|
|
Begin |
|
|
End |
|
|
Quantity |
|
|
Price |
|
(mcf/d) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural
gas price swaps |
|
1/1/2018 |
|
|
12/31/2018 |
|
|
500 |
|
|
$ |
3.01 |
|
|
Transaction Subsequent to September 30,
2017
As previously announced, on October 4, 2017,
U.S. Energy Corp., the Company’s wholly owned subsidiary Energy One
LLC and Statoil Oil and Gas LP (“Statoil”) entered into a purchase
and sale agreement (the “Purchase Agreement”), pursuant to which,
on the terms, and subject to the conditions of the Purchase
Agreement, the Company assigned, sold, and conveyed certain
non-operated assets in the Williston Basin, North Dakota, in
consideration for the elimination of $4.0 million in outstanding
liabilities and payment by Statoil to the Company of $2.0 million
in cash. U.S. Energy has historically accounted for the
eliminated liabilities on the Company’s balance sheet under
“Payable to major operator” and “Contingent ownership
interests.” The Purchase Agreement was unanimously approved
by the board of directors of the Company and closed on October 5,
2017, with an effective date of August 1, 2017. As the transaction
closed in the fourth quarter of 2017, the effects of this
transaction will be reflected on U.S. Energy’s year-end 2017
financial statements and year-end 2017 reserve report.
About U.S. Energy Corp.
We are an independent energy company focused on
the lease acquisition and development of oil and gas producing
properties in the continental United States. Our business is
currently focused in the Williston Basin of North Dakota and South
Texas. We continue to focus on increasing production, reserves, and
cash flow from operations while pro-actively managing our debt
levels. More information about U.S. Energy Corp. can be found at
www.usnrg.com.
Forward-Looking Statements
This press release may include “forward-looking
statements” within the meaning of the securities laws. All
statements other than statements of historical facts included
herein may constitute forward-looking statements. Forward-looking
statements in this document may include statements regarding the
Company’s expectations regarding the Company’s operational,
exploration and development plans; expectations regarding the
nature and amount of the Company’s reserves; and expectations
regarding production, revenues, cash flows and recoveries. When
used in this press release, the words "will," "potential,"
"believe," "estimate," "intend," "expect," "may," "should,"
"anticipate," "could," "plan," "predict," "project," "profile,"
"model," or their negatives, other similar expressions or the
statements that include those words, are intended to identify
forward-looking statements, although not all forward-looking
statements contain such identifying words. Such statements are
subject to a number of assumptions, risks and uncertainties, many
of which are beyond the control of the Company, which may cause
actual results to differ materially from those implied or expressed
by the forward-looking statements. Factors that could cause or
contribute to such differences include, but are not limited to,
fluctuations in oil and natural gas prices, uncertainties inherent
in estimating quantities of oil and natural gas reserves and
projecting future rates of production and timing of development
activities, competition, operating risks, acquisition risks,
liquidity and capital requirements, the effects of governmental
regulation, adverse changes in the market for the Company’s oil and
natural gas production, dependence upon third-party vendors, and
other risks detailed in the Company’s periodic report filings with
the Securities and Exchange Commission.
|
|
|
|
|
|
|
U.S. ENERGY CORP. CONDENSED CONSOLIDATED
BALANCE SHEETS(Unaudited) |
|
|
|
|
|
|
|
|
|
September 30, 2017 |
|
|
December 31, 2016 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and
equivalents |
|
$ |
1,814 |
|
|
$ |
2,518 |
|
Oil and
gas sales receivable |
|
|
464 |
|
|
|
562 |
|
Discontinued operations - assets of mining segment |
|
|
114 |
|
|
|
114 |
|
Assets
available for sale |
|
|
653 |
|
|
|
653 |
|
Marketable securities |
|
|
464 |
|
|
|
946 |
|
Commodity
price risk derivatives |
|
|
29 |
|
|
|
- |
|
Other
current assets |
|
|
131 |
|
|
|
96 |
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
3,669 |
|
|
|
4,889 |
|
|
|
|
|
|
|
|
|
|
Oil and gas
properties under full cost method: |
|
|
|
|
|
|
|
|
Unevaluated properties and exploratory wells in progress |
|
|
4,664 |
|
|
|
4,664 |
|
Evaluated
properties |
|
|
87,919 |
|
|
|
87,834 |
|
Less
accumulated depreciation, depletion and amortization |
|
|
(83,233 |
) |
|
|
(82,640 |
) |
|
|
|
|
|
|
|
|
|
Net oil and gas properties |
|
|
9,350 |
|
|
|
9,858 |
|
|
|
|
|
|
|
|
|
|
Other
assets: |
|
|
|
|
|
|
|
|
Property
and equipment, net |
|
|
1,749 |
|
|
|
1,864 |
|
Other
assets |
|
|
125 |
|
|
|
156 |
|
|
|
|
|
|
|
|
|
|
Total other assets |
|
|
1,874 |
|
|
|
2,020 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
14,893 |
|
|
$ |
16,767 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities: |
|
|
|
|
|
|
|
|
Payable
to major operator |
|
$ |
2,442 |
|
|
$ |
2,710 |
|
Contingent ownership interests |
|
|
1,557 |
|
|
|
1,430 |
|
Other |
|
|
392 |
|
|
|
743 |
|
Accrued
compensation and benefits |
|
|
69 |
|
|
|
49 |
|
Current
portion of long-term debt |
|
|
- |
|
|
|
6,000 |
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
4,460 |
|
|
|
10,932 |
|
|
|
|
|
|
|
|
|
|
Noncurrent
liabilities: |
|
|
|
|
|
|
|
|
Revolving
credit facility |
|
|
6,000 |
|
|
|
- |
|
Asset
retirement obligations |
|
|
1,069 |
|
|
|
1,045 |
|
Warrant
liability |
|
|
580 |
|
|
|
1,030 |
|
Other
liabilities |
|
|
6 |
|
|
|
2 |
|
Total noncurrent liabilities |
|
|
7,655 |
|
|
|
2,077 |
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies (Note 7) |
|
|
|
|
|
|
|
|
Shareholders'
equity: |
|
|
|
|
|
|
|
|
Preferred
stock, par value $0.01 per share. Authorized 100,000 shares, 50,000
shares of series A Convertible Preferred Stock outstanding as of
September 30, 2017 and December 31, 2016; liquidation preference of
$2,450 as of September 30, 2017. |
|
|
1 |
|
|
|
1 |
|
Common
stock, $0.01 par value; unlimited shares authorized; 5,983,498 and
5,834,568 shares issued and outstanding, respectively |
|
|
61 |
|
|
|
61 |
|
Additional paid-in capital |
|
|
127,864 |
|
|
|
127,576 |
|
Accumulated deficit |
|
|
(124,611 |
) |
|
|
(123,825 |
) |
Other
comprehensive loss |
|
|
(537 |
) |
|
|
(55 |
) |
|
|
|
|
|
|
|
|
|
Total shareholders' equity |
|
|
2,778 |
|
|
|
3,758 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders' equity |
|
$ |
14,893 |
|
|
$ |
16,767 |
|
|
|
|
|
|
|
U.S. ENERGY CORP. CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS(Unaudited)(In Thousands,
Except Share and Per Share Amounts) |
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
September 30: |
|
|
September 30: |
|
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil |
|
$ |
1,311 |
|
|
$ |
1,496 |
|
|
$ |
4,141 |
|
|
$ |
4,037 |
|
Natural
gas and liquids |
|
|
227 |
|
|
|
371 |
|
|
|
1,135 |
|
|
|
892 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue |
|
|
1,538 |
|
|
|
1,867 |
|
|
|
5,276 |
|
|
|
4,929 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil and
gas operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production costs |
|
|
856 |
|
|
|
1,348 |
|
|
|
2,712 |
|
|
|
3,812 |
|
Depreciation, depletion and amortization |
|
|
146 |
|
|
|
669 |
|
|
|
618 |
|
|
|
2,315 |
|
Impairment of oil and gas properties |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
9,568 |
|
General
and administrative: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits, including directorand contract
employees |
|
|
190 |
|
|
|
158 |
|
|
|
544 |
|
|
|
469 |
|
Stock-based compensation |
|
|
77 |
|
|
|
30 |
|
|
|
289 |
|
|
|
98 |
|
Professional services |
|
|
268 |
|
|
|
457 |
|
|
|
1,618 |
|
|
|
1,225 |
|
Insurance, rent and other |
|
|
64 |
|
|
|
99 |
|
|
|
301 |
|
|
|
282 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
operating expenses |
|
|
1,601 |
|
|
|
2,761 |
|
|
|
6,082 |
|
|
|
17,769 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
|
(63 |
) |
|
|
(894 |
) |
|
|
(806 |
) |
|
|
(12,840 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized
gain on commodity price riskderivatives |
|
|
116 |
|
|
|
139 |
|
|
|
217 |
|
|
|
1,401 |
|
Unrealized gain (loss) on commodity price risk derivatives |
|
|
(282 |
) |
|
|
(97 |
) |
|
|
29 |
|
|
|
(1,557 |
) |
Gain on
sale of assets |
|
|
- |
|
|
|
- |
|
|
|
1 |
|
|
|
100 |
|
Gain on
receipt of marketable equity securities |
|
|
- |
|
|
|
750 |
|
|
|
- |
|
|
|
750 |
|
Rental
and other income (loss) |
|
|
53 |
|
|
|
(46 |
) |
|
|
(296 |
) |
|
|
(125 |
) |
Warrant
fair value adjustment |
|
|
(70 |
) |
|
|
- |
|
|
|
450 |
|
|
|
- |
|
Interest
expense |
|
|
(136 |
) |
|
|
(117 |
) |
|
|
(382 |
) |
|
|
(364 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
other income (expense) |
|
|
(319 |
) |
|
|
629 |
|
|
|
19 |
|
|
|
205 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations |
|
|
(382 |
) |
|
|
(265 |
) |
|
|
(787 |
) |
|
|
(12,635 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(2,448 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(2,448 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss |
|
|
(382 |
) |
|
|
(265 |
) |
|
|
(787 |
) |
|
|
(15,083 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
fair value of marketable equitysecurities |
|
|
(158 |
) |
|
|
(6 |
) |
|
|
(482 |
) |
|
|
921 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive Loss |
|
$ |
(540 |
) |
|
$ |
(271 |
) |
|
$ |
(1,269 |
) |
|
$ |
(14,162 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
continuing operations applicable to common
shareholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
continuing operations |
|
$ |
(382 |
) |
|
$ |
(265 |
) |
|
$ |
(787 |
) |
|
$ |
(12,635 |
) |
Accrued
dividends related to Series A Convertible Preferred Stock |
|
|
(74 |
) |
|
|
(68 |
) |
|
|
(219 |
) |
|
|
(164 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations applicable to common
shareholders |
|
$ |
(456 |
) |
|
$ |
(333 |
) |
|
$ |
(1,006 |
) |
|
$ |
(12,799 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per
share- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
(0.07 |
) |
|
$ |
(0.06 |
) |
|
$ |
(0.13 |
) |
|
$ |
(2.67 |
) |
Discontinued operations |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(0.52 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
(0.07 |
) |
|
$ |
(0.06 |
) |
|
$ |
(0.13 |
) |
|
$ |
(3.19 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
5,834,568 |
|
|
|
4,768,000 |
|
|
|
5,834,568 |
|
|
|
4,726,000 |
|
Diluted: |
|
|
5,834,568 |
|
|
|
4,768,000 |
|
|
|
5,834,568 |
|
|
|
4,726,000 |
|
|
|
|
|
|
|
|
U.S. ENERGY CORP. CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS(Unaudited)(In
Thousands) |
|
|
|
|
|
|
|
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
Cash flows from
operating activities: |
|
|
|
|
|
|
|
|
Net
loss |
|
$ |
(787 |
) |
|
$ |
(15,083 |
) |
Loss from
discontinued operations |
|
|
- |
|
|
|
2,448 |
|
Loss from
continuing operations |
|
|
(787 |
) |
|
|
(12,635 |
) |
Adjustments to reconcile loss from continuing operations to net
cash used in operating activities: |
|
|
|
|
|
|
|
|
Depreciation and depletion |
|
|
723 |
|
|
|
2,422 |
|
Debt
amortization |
|
|
9 |
|
|
|
221 |
|
Impairment of oil and gas properties |
|
|
- |
|
|
|
9,568 |
|
Change in
fair value of commodity price risk derivative |
|
|
(29 |
) |
|
|
1,557 |
|
Stock-based compensation and services |
|
|
289 |
|
|
|
98 |
|
Warrant
fair value adjustment |
|
|
(450 |
) |
|
|
- |
|
Other |
|
|
(189 |
) |
|
|
(850 |
) |
Changes
in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Decrease
(increase) in: |
|
|
|
|
|
|
|
|
Oil and
gas sales receivable |
|
|
98 |
|
|
|
449 |
|
Other
assets |
|
|
(35 |
) |
|
|
(74 |
) |
Increase
(decrease) in: |
|
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities |
|
|
(355 |
) |
|
|
(1,111 |
) |
Accrued
compensation and benefits |
|
|
20 |
|
|
|
(1,120 |
) |
|
|
|
|
|
|
|
|
|
Net cash
used in operating activities |
|
|
(706 |
) |
|
|
(1,475 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
|
|
|
Capital
expenditures |
|
|
(21 |
) |
|
|
(121 |
) |
Proceeds
from asset sale |
|
|
23 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
Net cash
provided by (used in) investing activities: |
|
|
2 |
|
|
|
(121 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
|
|
|
|
Proceeds
from issuance of preferred stock |
|
|
- |
|
|
|
1 |
|
Payments
for debt issuance costs |
|
|
- |
|
|
|
(105 |
) |
Cash
payment for fractional shares in reverse stock split |
|
|
- |
|
|
|
(3 |
) |
|
|
|
|
|
|
|
|
|
Net cash
used in financing activities |
|
|
- |
|
|
|
(107 |
) |
|
|
|
|
|
|
|
|
|
Discontinued
operations: |
|
|
|
|
|
|
|
|
Net cash
used in discontinued operations |
|
|
- |
|
|
|
(447 |
) |
|
|
|
|
|
|
|
|
|
Net
decrease in cash and equivalents |
|
|
(704 |
) |
|
|
(2,150 |
) |
|
|
|
|
|
|
|
|
|
Cash and equivalents,
beginning of period |
|
|
2,518 |
|
|
|
3,354 |
|
|
|
|
|
|
|
|
|
|
Cash and equivalents,
end of period |
|
$ |
1,814 |
|
|
$ |
1,204 |
|
|
|
|
|
|
|
|
|
|
Non-cash
investing and financing activities: |
|
|
|
|
|
|
|
|
Issuance of preferred
stock in disposition of mining segment |
|
|
- |
|
|
$ |
1,999 |
|
|
|
|
|
|
|
|
|
|
Elimination of asset
retirement obligations in disposition of mining segment |
|
|
- |
|
|
|
204 |
|
|
|
|
|
|
|
|
|
|
Unrealized gain (loss)
on marketable equity securities |
|
|
(483 |
) |
|
|
921 |
|
|
|
|
|
|
|
|
|
|
Net additions to oil
and gas properties through asset retirement obligations |
|
|
- |
|
|
|
1 |
|
|
|
|
|
|
|
|
|
|
In addition to reporting net income (loss) as defined under
GAAP, we also present net earnings before interest, income taxes,
depletion, depreciation, and amortization, accretion of discount on
asset retirement obligations, impairment of oil and natural gas
properties, warrant revaluation (gains) and expenses, net gain
(loss) from mark-to-market on commodity derivatives, cash
settlements received (paid), standby rig expenses and non-cash
expenses relating to share based payments recognized under ASC
Topic 718 (“Adjusted EBITDA”), which is a non-GAAP performance
measure. Adjusted EBITDA consists of net earnings after adjustment
for those items described in the table below. Adjusted EBITDA does
not represent, and should not be considered an alternative to GAAP
measurements, such as net income (loss) (its most directly
comparable GAAP measure), and our calculations thereof may not be
comparable to similarly titled measures reported by other
companies. By eliminating the items described below, we believe the
measure is useful in evaluating its fundamental core operating
performance. We also believe that Adjusted EBITDA is useful to
investors because similar measures are frequently used by
securities analysts, investors, and other interested parties in
their evaluation of companies in similar industries. Our management
uses Adjusted EBITDA to manage our business, including in preparing
our annual operating budget and financial projections. Our
management does not view Adjusted EBITDA in isolation and also uses
other measurements, such as net income (loss) and revenues to
measure operating performance. The following table provides a
reconciliation of net loss to Adjusted EBITDA for the periods
presented:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing
operations (GAAP) |
|
$ |
(382 |
) |
|
$ |
(265 |
) |
|
$ |
(787 |
) |
|
$ |
(12,635 |
) |
Impairment of oil and
gas properties |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
9,568 |
|
Depreciation, depletion
and amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil and
gas operations |
|
|
146 |
|
|
|
669 |
|
|
|
618 |
|
|
|
2,315 |
|
Other |
|
|
- |
|
|
|
5 |
|
|
|
- |
|
|
|
16 |
|
Unrealized (gain) loss
on oil price risk derivatives |
|
|
282 |
|
|
|
97 |
|
|
|
(29 |
) |
|
|
1,557 |
|
Stock-based
compensation |
|
|
77 |
|
|
|
30 |
|
|
|
289 |
|
|
|
98 |
|
Gain on sale of
assets |
|
|
- |
|
|
|
- |
|
|
|
(1 |
) |
|
|
(100 |
) |
Rental and other income
(expense), net |
|
|
(53 |
) |
|
|
(704 |
) |
|
|
296 |
|
|
|
(625 |
) |
Warrant Fair Value
Adjustment (gain) loss |
|
|
70 |
|
|
|
- |
|
|
|
(450 |
) |
|
|
- |
|
Interest expense |
|
|
136 |
|
|
|
117 |
|
|
|
382 |
|
|
|
364 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDAX (Non-GAAP) |
|
$ |
276 |
|
|
$ |
(51 |
) |
|
$ |
318 |
|
|
$ |
558 |
|
Corporate Contact:
U.S. Energy Corp.
Ryan Smith
Chief Financial Officer
(303) 993-3200
www.usnrg.com
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