DENVER, March 6, 2013 /PRNewswire/ -- Gasco Energy, Inc.
(NYSE MKT: GSX) ("Gasco" or the "Company") today announced
financial and operating results for the fourth quarter and
full-year periods ended December 31,
2012 and disclosed estimated 2012 proved reserves
quantities.
Note Regarding Uinta Basin Joint Venture
During Q1-12, Gasco conveyed a 50% interest in certain of its
Uinta Basin properties to its
joint venture partner concurrent with the March 22, 2012 closing of the joint
venture. Q4-12 is the third full reporting period in which
Gasco's Uinta Basin net production
reflects this conveyance under the terms of the Gasco-operated
joint venture. Due to the 50% interest conveyance,
operational and financial results for the three-month and annual
periods ended December 31, 2012 are
not similarly comparable to the same periods ended December 31, 2011.
Q4-12 Financial
Results
Oil and gas sales for the fourth quarter ended December 31, 2012 were $2.3 million, as compared to $3.7 million for the same period in 2011.
Natural gas sales comprised 76% of total oil and gas sales
for Q4-12. The year-over-year decrease in oil and gas
sales is primarily attributed to the sale of a portion of the
Company's interest in its properties in the Uinta Basin transaction, a 5% decrease in the
average price received for the Company's natural gas sales and a 9%
decrease in prices received for oil volumes. Oil and gas
sales for Q4-12 represent 26% growth over the $1.8 million in oil and gas sales posted during
Q3-12.
Gasco's average realized gas price was $3.53 per thousand cubic feet of natural gas
(Mcf) for Q4-12, compared to $3.71
per Mcf in the prior-year period, excluding the effect of
hedges. During June 2012, the
Company monetized its remaining commodity hedge contract, and the
Company currently does not have any commodity hedges in
place.
The average realized oil price for Q4-12 was $72.79 per barrel, as compared to $79.62 per barrel for the prior-year
period. Gasco does not hedge its crude oil volumes.
For Q4-12, Gasco reported a net loss of $8.9 million, or $0.05 per basic and diluted share, as compared to
a net loss of $4.5 million, or
$0.03 per basic and diluted share in
Q4-11. Included in the Q4-12 results are a non-cash gain of
$1.2 million attributed to
derivatives and a $7.4 million
non-cash expense item related to an impairment of the carrying
value of oil and gas properties.
Excluding the effect of the above-stated non-cash items, Gasco
would have posted a net loss of $2.6
million, or $0.02 per basic
and diluted share, for Q4-12. Net loss excluding the effect
of non-cash items is a non-GAAP financial measure. Management
believes net income or loss excluding the effect of certain
non-cash items such as derivative gains or losses and impairment
expense is a useful metric to investors to show income before the
impact of certain non-cash items, and it provides a measure of the
Company's cash available to fund its business and operations.
For further disclosure, please reference the reconciliation of net
loss excluding the effect of non-cash items to the most directly
comparable GAAP measures at the end of this news release.
As of December 31, 2012, Gasco's
total assets were $53.9 million, its
stockholders' equity was $17.7
million, and cash and cash equivalents were $2.9 million.
The Company had long-term debt of $45.0
million as of December 31,
2012, consisting of its 5.5% convertible senior notes due
2015.
Net cash used in operating activities during Q4-12 was
$1.4 million, as compared to net cash
used in operating activities of $3.2
million in the comparable 2011 reporting period. Net
cash used in investing activities during Q4-12 was $1.2 million, as compared to net cash used in
investing activities in the prior-year period of $3.7 million. During March 2012, Gasco repaid $10.5 million in borrowings in connection with
the maturity of its revolving credit facility. In
June 2012, the Company's revolving
credit facility matured and was repaid in full. The Company
attempted to secure a replacement facility, but has been unable to
do so on acceptable terms and it is no longer actively in
discussions to obtain a replacement facility.
Q4-12 Unit Cost and Expense Comparisons
Total lease operating expense (LOE) for Q4-12 was $1.1 million, as compared to $3.7 million in the prior-year period. On a
per-unit basis, Q4-12 LOE was $2.12
per thousand cubic feet of natural gas equivalent (Mcfe), as
compared to $4.14 per Mcfe in the
prior-year period. The 49% decrease in LOE per Mcfe is
primarily attributable to the conveyance of a 50% interest in
certain of the Company's properties in connection with the
Uinta Basin transaction which
closed during March 2012 and a 79%
decrease in workover expenses because of fewer projects during
Q4-12.
Transportation and processing expense was $0.2 million during Q4-12, or $0.37 per Mcfe, as compared to $0.6 million during the prior-year period, or
$0.69 per Mcfe. The 46%
decrease in these expenses per Mcfe during Q4-12 reflects lower
transportation and processing costs related to the 41% decrease in
gas production due to the Uinta
Basin transaction conveyance and normal production declines and to
the 5% decrease in natural gas prices.
Depletion, depreciation and amortization (DD&A) was
$0.7 million for both Q4-12 and
Q4-11. On a per-unit basis, DD&A for Q4-12 was
$1.31 per Mcfe, as compared to
$0.84 per Mcfe in the prior-year
period.
The Company reported general and administrative expense
(G&A) of $1.1 million for Q4-12,
versus $1.8 million in the prior-year
period. On a per-unit basis, total G&A for Q4-12 was
$2.12 per Mcfe, as compared to
$2.08 per Mcfe for the same period in
2011. G&A expense for Q4-12 includes $54,000 of non-cash, stock-based compensation
expense, or, on a per-unit basis, $0.10 per Mcfe, as compared to the prior-year
total of $72,000, or $0.08 per Mcfe.
Gasco
Energy, Inc.
|
Q4-12
|
Q3-12
|
Q4-11
|
|
2012
|
2011
|
%
Change
|
Unit
Cost Analysis
|
|
Sequential
|
Q-o-Q
|
Y-o-Y
|
Sales
Volumes in Barrels of Oil Equivalent (Mcfe)
|
539,977
|
542,092
|
883,860
|
|
2,561,342
|
3,880,902
|
0%
|
-39%
|
-34%
|
Average
Price Received Gas ($ / Mcf)
|
$
3.53
|
$
2.81
|
$
3.71
|
|
$
2.82
|
$
4.20
|
26%
|
-5%
|
-33%
|
Average
Price Received Oil ($ / Bbl)
|
72.79
|
83.14
|
79.62
|
|
81.38
|
80.75
|
-12%
|
-9%
|
1%
|
LOE
Components
|
-
|
-
|
-
|
|
-
|
-
|
-
|
-
|
-
|
Direct Operating Expenses ($ /
Mcfe)
|
2.31
|
1.29
|
2.93
|
|
1.45
|
1.44
|
79%
|
-21%
|
1%
|
Workover Expense ($ / Mcfe)
|
0.25
|
0.41
|
1.21
|
|
0.51
|
0.64
|
-38%
|
-79%
|
-20%
|
Production Tax ($ / Mcfe)
|
0.12
|
0.10
|
0.10
|
|
0.10
|
0.18
|
24%
|
23%
|
-46%
|
Total
Lease Operating Expense ($ / Mcfe)
|
2.12
|
1.80
|
4.14
|
|
1.94
|
2.26
|
18%
|
-49%
|
-14%
|
Transportation Expense ($ / Mcfe)
|
0.37
|
0.60
|
0.69
|
|
0.67
|
0.72
|
-38%
|
-46%
|
-8%
|
DD&A Expense ($ / Mcfe)
|
1.31
|
0.97
|
0.84
|
|
1.07
|
0.90
|
35%
|
57%
|
19%
|
G&A
Expense ($ / Mcfe)
|
2.12
|
1.98
|
2.08
|
|
1.88
|
1.27
|
7%
|
2%
|
48%
|
Non-cash Stock-based Compensation
Expense ($ / Mcfe)
|
$
0.10
|
$
0.15
|
0.08
|
|
$
0.11
|
$
0.08
|
-33%
|
22%
|
32%
|
Full-Year Period 2012
Oil and gas sales for the year-ended December 31, 2012 were $8.9 million, as compared to $18.3 million for the same period in 2011.
The decrease in oil and gas sales during the 2012 full-year
reporting period, as compared to the prior-year period, is
primarily attributed to the Uinta
Basin transaction and to a 33% decrease in the average price
received for natural gas sales.
The average prices received for 2012 were $2.82 per Mcf and $81.38 per barrel of oil, as compared to
$4.20 per Mcf and $80.75 per barrel in the same period in 2011.
For 2012, Gasco reported a net loss of $22.2 million, or $0.13 per basic and diluted share, as compared to
a net loss of $7.3 million, or
$0.05 per basic and diluted share in
2011. Included in the 2012 results are a non-cash gain on
sale of assets of $2.6 million, a
non-cash gain of $3.7 million
attributed to derivatives and a $16.5
million non-cash expense item related to an impairment of
the carrying value of oil and gas properties.
Excluding the effect of the above-stated non-cash items, Gasco
would have posted a net loss of $12.0
million, or $0.07 per basic
and diluted share for 2012. Net loss excluding the effect of
non-cash items is a non-GAAP financial measure. Please see
the reconciliation of net loss excluding the effect of non-cash
items to the most directly comparable GAAP measures at the end of
this news release.
Net cash used in operating activities for 2012 was $3.7 million as compared to net cash used in
operating activities of $0.4 million
for the same period in 2011. The Company invested
approximately $5.8 million during
2012 in oil and gas activities. Net cash provided by
investing activities during 2012 included $19.2 million in cash proceeds from the sale of
certain of the Company's Uinta
Basin assets as part of the Uinta
Basin transaction. Net cash used in financing activities was
$8.5 million in 2012, as compared to
net cash provided by financing activities of $10.2 million during the prior-year period.
Fourth Quarter and Full-Year 2012 Production
Estimated cumulative net production for Q4-12 was 540 million
cubic feet of natural gas equivalent (MMcfe), as compared to 884
MMcfe in the prior-year period. Estimated cumulative net
production for 2012 was 2,561 MMcfe, as compared to prior-year
period net production of 3,881 MMcfe. Included in the 2012
equivalent calculation are 25,800 barrels of liquid hydrocarbons,
as compared to the prior-year period volumes of 7,950 barrels of
liquid hydrocarbons. Net production changes are attributed to
the Uinta Basin transaction and to
normal production declines in existing wells, which were partially
offset by new producing wells and recompletions and workovers of
existing wells.
2012 Estimated Proved Reserves Quantities
Gasco also today announced 2012 year-end total estimated proved
reserves of 14.1 billion cubic feet of natural gas equivalent
(Bcfe), comprised of 12.6 billion cubic feet (Bcf) of natural gas
and 252,000 barrels of oil. The Company's reserve mix is 89%
natural gas and 11% crude oil, 94% of which are proved developed
producing and 6% were proved developed not producing. As of
December 31, 2012, 100% of the
Company's reserves were classified as proved developed.
Reserve Reconciliation
|
Gas
Mcf
|
Oil
Bbl
|
Equivalents
Mcfe
(1)
|
|
|
|
|
Balance,
December 31, 2011
|
36,798,000
|
502,000
|
39,810,000
|
Extensions and discoveries
|
--
|
10,000
|
60,000
|
Revisions of previous estimates
|
(10,110,000)
|
(28,400)
|
(10,280,000)
|
Divestitures of reserves in place
|
(12,252,000)
|
(210,000)
|
(13,512,000)
|
Purchases of reserves in place
|
574,000
|
3,800
|
597,000
|
Production
|
(2,407,000)
|
(26,000)
|
(2,563,000)
|
Balance, December 31, 2012
|
12,604,000
|
252,000
|
14,113,000
|
|
|
|
|
Proved Developed Reserves
|
12,604,000
|
252,000
|
14,113,000
|
Totals may not add due to rounding
(1) Volumes of oil and natural gas are converted at the energy
equivalent rate of six thousand cubic feet of natural gas to one
barrel of crude oil.
Gasco's proved reserves at December 31,
2012 were computed using Securities and Exchange Commission
("SEC") guidelines. Commodity prices used in calculating the
economic quantities of reserves are based on the 12-month
unweighted arithmetic average of the first-day-of-the-month price
for the period January 2012 through
December 2012.
For natural gas volumes, the average Northwest (Wyoming pool) spot price of $2.62 per million British thermal units (MMBtu)
is adjusted by area for energy content, transportation fees and
regional price differentials. For oil and condensate volumes,
the average Wall Street Journal West Texas Intermediate posted
price of $94.71 per barrel is
adjusted for quality, transportation fees and regional price
differentials.
For 2012, Gasco's average adjusted product prices held constant
used in calculating reserve quantities were $2.15 per Mcf and $80.25 per barrel of oil.
Based on these prices, the estimated discounted net present
value of Gasco's proved reserves, before projected income taxes,
using a 10% per annum discount rate ("PV-10") was $10.3 million at December
31, 2012.
The PV-10 reserve measurement is considered to be a non-GAAP
financial measure; however as of December
31, 2012, the PV-10 and the standardized measure of
discounted future net cash flows are equal because the effects of
estimated future income tax expenses are zero. The Company
believes that PV-10 is useful to investors because it presents the
discounted future net cash flows attributable to the Company's
estimated net proved reserves prior to taking into account future
income taxes, and it is a useful measure for evaluating the
relative monetary significance of the Company's oil and gas
properties.
All of the reserves valued in the report are located in Gasco's
Riverbend Project area in Carbon,
Duchesne, and Uintah Counties in Utah's Uinta Basin. Reserve estimates
have been prepared by independent reservoir engineering
consultants, Netherland, Sewell & Associates, Inc., in
accordance with the definitions and regulations of the SEC.
The proved reserves are also prepared in accordance with
Financial Accounting Standards Codification Topic 932,
Extractive Activities – Oil and Gas. In accordance
with SEC guidelines, reserve estimates do not include any probable
or possible reserves that may exist for Gasco's properties.
Outlook
Due to the significant extended decline in the natural gas
market and sustained low natural gas prices caused by excess
production and stagnant demand for natural gas, the Company has not
been able to recover its exploration and development costs as
anticipated. As such, there is substantial doubt regarding
the Company's ability to generate sufficient cash flows from
operations to fund its ongoing operations, and it currently
anticipates that cash on hand and forecasted cash flows from
operations will only be sufficient to fund cash requirements for
working capital, including debt payment obligations, through the
second quarter of 2013. There can be no assurance that the Company
will be able to adequately finance its operations or execute its
existing short-term and long-term business plans, and its liquidity
and results of operations are likely to be materially adversely
affected if it is unable to generate sufficient operating cash
flows, secure additional capital or otherwise pursue a strategic
restructuring, refinancing or other transaction to provide
additional liquidity. The Company has engaged a financial advisor
to assist it in evaluating such potential strategic alternatives.
It is possible these strategic alternatives will require the
Company to make a pre-packaged, pre-arranged or other type of
filing for protection under Chapter 11 of the U.S. Bankruptcy Code
(or an involuntary petition for bankruptcy may be filed against the
Company). These factors raise substantial doubt about the Company's
ability to continue as a going concern.
Teleconference Call
A conference call with investors, analysts and other interested
parties is scheduled for 11:00 a.m.
EST on Thursday, March 7, 2013
to discuss Q4-12 and full-year 2012 financial and operating
results. You are invited to participate in the call which
will be broadcast live over the Internet and via
teleconference.
Gasco
Energy Q4-12 and Full-Year 2012 Financial and Operating Results
Conference Call
|
Date:
|
Thursday,
March 7, 2013
|
Time:
|
11:00 a.m.
EST
10:00 a.m.
CST
9:00 a.m.
MST
8:00 a.m.
PST
|
Call:
|
(866)
392-4171 (US/Canada) and (706) 634-6345 (International),
Passcode /
Conference ID #: 16204411
|
Webcast/Internet:
|
Live and
rebroadcast over the Internet:
http://us.meeting-stream.com/gascoenergyinc_030613
|
Replay:
|
Available
through Thursday, March 14, 2013 at (855) 859-2056
(US/Canada) and (404) 537-3406 (International) using
passcode # 16204411 and for 30 days at
http://www.gascoenergy.com
|
About Gasco Energy
Denver-based Gasco Energy, Inc.
is a natural gas and petroleum exploitation, development and
production company engaged in locating and developing hydrocarbon
resources, primarily in the Rocky Mountain region and in
California's San Joaquin
Basin. Gasco's principal business is the acquisition of
leasehold interests in petroleum and natural gas rights, either
directly or indirectly, and the exploitation and development of
properties subject to these leases. Gasco focuses its
drilling efforts in the Riverbend Project located in the
Uinta Basin of northeastern
Utah, targeting the oil-bearing
Green River Formation and the natural gas-prone Wasatch, Mesaverde, Blackhawk, Mancos, Dakota and Morrison formations. To learn more,
visit Gasco's website at www.gascoenergy.com.
Forward-looking Statements
Certain statements set forth in this press release relate to
management's future plans, objectives and expectations. Such
statements are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. All
statements other than statements of historical fact included in
this press release, including, without limitation, statements
regarding Gasco's future financial position, expectations with
respect to its liquidity, capital resources and ability to continue
as a going concern, business strategy, budgets, projected costs and
plans and objectives of management for future operations, are
forward-looking statements. These statements express, or are based
on, management's current expectations and forecasts about future
events. In addition, forward-looking statements generally can be
identified by the use of forward-looking terminology such as "may,"
"will," "should," "would," "could," "expect," "intend," "project,"
"estimate," "anticipate," "plan," "believe," "foresee," or
"continue" or the negative thereof or similar
terminology.
Although any forward-looking statements contained in this press
release or otherwise expressed by us are to the knowledge and in
the judgment of management, believed to be reasonable when made,
there can be no assurances that any of these expectations will
prove correct or that any of the actions that are planned will be
taken. Forward-looking statements involve and may be affected
by inaccurate assumptions, and known and unknown risks and
uncertainties (some of which are beyond Gasco's control), that may
cause Gasco's actual performance and financial results in future
periods to differ materially from any projection, estimate or
forecasted result. Some of the key factors that may cause
actual results to vary from those Gasco expects include Gasco's
ability to maintain adequate cash flow from operations or obtain
adequate financing to fund its operations and meet working capital
needs and its related ability to continue as a going concern;
volatility and declines in Gasco's stock price and its ability to
regain and maintain compliance with NYSE MKT continued listing
standards; the ability to meet firm commitment delivery obligations
in transportation and processing agreements or otherwise satisfy
minimum volume deficiency payment obligations; the ability to
pursue strategic restructuring, refinancing or other transactions
which may be necessary to continue as a going concern; the ability
to remain in compliance with the terms and conditions of our
outstanding convertible senior notes and warrants; the ability to
maintain relationships with suppliers and customers; overall demand
for natural gas and oil in the United
States; the ability to successfully operate within the
restrictions imposed by the indenture governing Gasco's convertible
senior notes; any requirement to write down the carrying value of
oil and natural gas properties due to reductions in oil and natural
gas prices, or downward adjustments to estimated proved reserves;
inherent uncertainties in interpreting engineering and reserve or
production data; operating hazards; delays or cancellations of
drilling operations because of weather and other natural and
economic forces; fluctuations in oil and natural gas prices;
competition from other companies with greater resources;
environmental and other government regulations, including new or
proposed legislation; defects in title to properties; inability to
borrow or unavailability of other sources of capital resources to
fund capital expenditures; general economic conditions in
the United States; Gasco's ability
to manage interest rate and commodity price exposure; the condition
of credit and capital markets in the
United States; and other risks described in (1) Part I,
"Item 1A–Risk Factors," "Item 7–Management's Discussion and
Analysis of Financial Condition and Results of Operations," "Item
7A–Quantitative and Qualitative Disclosure About Market Risk" and
elsewhere in Gasco's Annual Report on Form 10-K for the year ended
December 31, 2012, and (2) Gasco's
other reports and registration statements filed from time to time
with the SEC.
Any of these factors could cause Gasco's actual results to
differ materially from the results implied by these or any other
forward-looking statements made by Gasco or on its behalf.
Gasco cannot assure you that its future results will meet its
expectations. When you consider these forward-looking
statements, you should keep in mind these factors. All
subsequent written and oral forward-looking statements attributable
to Gasco, or persons acting on its behalf, are expressly qualified
in their entirety by these factors. Gasco's forward-looking
statements speak only as of the date made. Gasco assumes no
duty to update or revise its forward-looking statements based on
changes in internal estimates or expectations or otherwise.
[Financial and Operational Tables Accompany this News
Release]
The notes accompanying the financial statements are an
integral part of the consolidated financial statements and can be
found in Gasco's Filing on Form 10-K for the year ended
December 31, 2012 filed with the SEC
on March 6, 2013.
|
GASCO
ENERGY, INC.
|
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
|
|
2012
|
|
2011
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
2,938,086
|
|
$
1,965,967
|
Accounts receivable
|
|
|
|
|
|
Joint interest billings
|
|
|
1,753,204
|
|
810,482
|
Revenue
|
|
|
777,567
|
|
1,483,382
|
Inventory
|
|
|
1,730,733
|
|
1,911,362
|
Note receivable
|
|
|
-
|
|
500,000
|
Derivative instruments
|
|
|
-
|
|
865,358
|
Prepaid and other expenses
|
|
|
153,848
|
|
152,045
|
Total
|
|
|
7,353,438
|
|
7,688,596
|
|
|
|
|
|
|
PROPERTY, PLANT AND EQUIPMENT, at
cost
|
|
|
|
|
|
Oil
and gas properties (full cost method)
|
|
|
|
|
|
Proved
properties
|
|
|
264,814,427
|
|
268,793,463
|
Unproved
properties
|
|
|
31,486,314
|
|
36,938,162
|
Wells in progress
|
|
|
-
|
|
1,938,691
|
Facilities and equipment
|
|
|
1,493,314
|
|
1,502,921
|
Furniture, fixtures and other
|
|
|
506,511
|
|
167,737
|
Total
|
|
|
298,300,566
|
|
309,340,974
|
Less accumulated depletion, depreciation, amortization and
impairment
|
|
|
(253,176,523)
|
|
(234,132,806)
|
Total
|
|
|
45,124,043
|
|
75,208,168
|
|
|
|
|
|
|
NON-CURRENT ASSETS
|
|
|
|
|
|
Deposit
|
|
|
531,443
|
|
639,500
|
Deferred financing costs
|
|
|
845,367
|
|
1,117,972
|
|
|
|
1,376,810
|
|
1,757,472
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
|
$ 53,854,291
|
|
$ 84,654,236
|
|
|
|
|
|
|
|
GASCO
ENERGY, INC.
|
CONSOLIDATED BALANCE SHEETS
(continued)
|
|
|
|
|
|
|
|
December 31,
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
Accounts payable
|
|
|
$
1,548,121
|
|
$
2,649,772
|
Revenue payable
|
|
|
2,454,282
|
|
2,043,240
|
Advances from joint interest owners
|
|
|
47,667
|
|
98,512
|
Current portion of long-term debt
|
|
|
-
|
|
8,544,969
|
Accrued interest
|
|
|
586,556
|
|
586,556
|
Accrued expenses
|
|
|
396,000
|
|
355,224
|
Total
|
|
|
5,032,626
|
|
14,278,273
|
|
|
|
|
|
|
NONCURRENT LIABILITIES
|
|
|
|
|
|
5.5% Convertible Senior Notes due 2015, net of
unamortized discount of $18,530,539 and $22,574,687 as of
December 31, 2012 and
2011, respectively
|
|
|
26,637,461
|
|
22,593,313
|
Deferred income from sale of assets
|
|
|
2,463,177
|
|
2,665,629
|
Derivative instruments
|
|
|
907,500
|
|
4,235,000
|
Deferred rent
|
|
|
294,236
|
|
-
|
Asset retirement
obligation
|
|
|
815,660
|
|
1,226,796
|
Total
|
|
|
31,118,034
|
|
30,720,738
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES (NOTE
16)
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Series B Convertible Preferred stock - $.001 par value; 20,000
shares authorized; zero shares
outstanding
|
|
|
-
|
|
-
|
Series C Convertible Preferred stock - $0.001 par
value; 2,000,000 shares authorized; 182,065 and 191,000 shares outstanding as
of December 31, 2012 and
2011, respectively
|
|
|
182
|
|
191
|
Common stock - $.0001 par value; 600,000,000 shares
authorized; 169,823,681 shares issued and 169,749,981
shares outstanding as of December
31, 2012; 168,084,515 shares issued and 168,010,815
shares outstanding as of December 31, 2011
|
|
|
16,982
|
|
16,808
|
Additional paid-in-capital
|
|
|
262,624,918
|
|
262,344,286
|
Accumulated deficit
|
|
|
(244,808,156)
|
|
(222,575,765)
|
Less cost of treasury stock of 73,700 common shares
|
|
|
(130,295)
|
|
(130,295)
|
Total
|
|
|
17,703,631
|
|
39,655,225
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
$ 53,854,291
|
|
$ 84,654,236
|
|
|
GASCO
ENERGY, INC.
|
CONSOLIDATED STATEMENTS OF
OPERATIONS
|
|
|
|
|
|
|
|
For the
Years Ended December 31,
|
|
|
|
2012
|
2011
|
2010
|
|
|
|
|
|
|
REVENUES
|
|
|
|
|
|
Gas
|
|
|
$
6,779,540
|
$
15,359,973
|
$
17,053,924
|
Oil
|
|
|
2,100,133
|
2,975,635
|
2,612,233
|
Gathering
|
|
|
-
|
-
|
595,942
|
Total
|
|
|
8,879,673
|
18,335,608
|
20,262,099
|
|
|
|
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
Lease operating
|
|
|
4,960,037
|
8,879,502
|
6,057,571
|
Gathering operations
|
|
|
-
|
-
|
375,848
|
Transportation and processing
|
|
|
1,704,677
|
2,759,780
|
3,002,719
|
Depletion, depreciation and amortization
|
|
|
2,732,694
|
3,525,806
|
3,565,672
|
Impairment
|
|
|
16,486,000
|
-
|
-
|
General and administrative
|
|
|
4,818,644
|
4,933,691
|
6,743,539
|
Total
|
|
|
30,702,052
|
20,098,779
|
19,745,349
|
|
|
|
|
|
|
OPERATING (LOSS) INCOME
|
|
|
(21,822,379)
|
(1,763,171)
|
516,750
|
|
|
|
|
|
|
OTHER
(EXPENSE) INCOME
|
|
|
|
|
|
Interest expense
|
|
|
(6,922,814)
|
(6,764,933)
|
(17,683,753)
|
Gain on sale of assets
|
|
|
2,567,574
|
-
|
-
|
Derivative gains
|
|
|
3,718,090
|
996,484
|
11,316,191
|
Gain on extinguishment of debt
|
|
|
-
|
-
|
15,772,441
|
Amortization of deferred income from sale of assets
|
|
|
202,452
|
202,452
|
168,710
|
Interest income
|
|
|
24,686
|
27,523
|
36,681
|
Total
|
|
|
(410,012)
|
(5,538,474)
|
9,610,270
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
(LOSS) INCOME
|
|
|
$(22,232,391)
|
$(7,301,645)
|
$10,127,020
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
(LOSS) INCOME PER COMMON SHARE
|
|
|
|
|
|
BASIC
|
|
|
$ (0.13)
|
$ (0.05)
|
$ 0.08
|
DILUTED
|
|
|
$ (0.13)
|
$ (0.05)
|
$ 0.08
|
GASCO
ENERGY, INC.
|
CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
|
|
|
For the
Years Ended December 31,
|
|
|
2012
|
2011
|
|
2010
|
CASH
FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
Net
(loss) income
|
|
$(22,232,391)
|
$(7,301,645)
|
|
$10,127,020
|
Adjustment to reconcile net (loss) income to net cash
(used in) provided by operating activities
|
|
|
|
|
|
Depletion, depreciation, amortization, accretion
and impairment expense
|
|
19,218,694
|
3,525,806
|
|
3,565,672
|
Stock-based compensation
|
|
269,979
|
323,733
|
|
1,365,264
|
Gain on extinguishment of debt
|
|
-
|
-
|
|
(15,772,441)
|
Change in fair value of derivative
instruments
|
|
(2,462,142)
|
(472,024)
|
|
(9,727,956)
|
Gain on sale of assets
|
|
(2,567,574)
|
-
|
|
-
|
Amortization of debt discount, deferred expenses and
other
|
|
4,126,759
|
3,301,796
|
|
13,734,361
|
Payment of deposit
|
|
(12,943)
|
-
|
|
-
|
Changes in operating assets and
liabilities:
|
|
|
|
|
|
Accounts receivable
|
|
(230,971)
|
1,425,969
|
|
117,298
|
Inventory
|
|
180,629
|
(241,957)
|
|
(799,092)
|
Note receivable
|
|
500,000
|
-
|
|
-
|
Prepaid and other expenses
|
|
(1,803)
|
(22,732)
|
|
170,784
|
Accounts payable
|
|
(1,040,651)
|
406,847
|
|
816,919
|
Revenue payable
|
|
411,042
|
(555,453)
|
|
353,148
|
Accrued interest
|
|
-
|
(5,195)
|
|
(250,965)
|
Accrued expenses
|
|
172,700
|
(814,645)
|
|
(56,161)
|
Net cash (used in) provided by operating activities
|
|
(3,668,672)
|
(429,500)
|
|
3,643,851
|
|
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
Cash paid for acquisitions, development and exploration
|
|
(5,756,886)
|
(8,790,336)
|
|
(6,981,247)
|
Cash paid for furniture, fixtures and other
|
|
(205,774)
|
(890)
|
|
(17,522)
|
(Decrease) increase in advances from joint interest
owners
|
|
(50,845)
|
(1,065,902)
|
|
1,164,414
|
Proceeds from property sales
|
|
19,199,265
|
10,000
|
|
24,309,000
|
Net cash provided by (used in) investing activities
|
|
13,185,760
|
(9,847,128)
|
|
18,474,645
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
Borrowings under line of
credit
|
|
2,000,000
|
2,000,000
|
|
1,000,000
|
Proceeds from issuance of common stock and
warrants
|
|
-
|
10,000,000
|
|
-
|
Repayment of borrowings
|
|
(10,544,969)
|
-
|
|
(29,000,000)
|
Cash paid for debt and stock issuance
costs
|
|
-
|
(1,351,947)
|
|
(2,146,894)
|
Repurchase of convertible notes
|
|
-
|
-
|
|
(54,400)
|
Payment of deposit
|
|
-
|
-
|
|
(500,000)
|
Repayment of convertible notes
|
|
-
|
(400,000)
|
|
-
|
Net cash (used in) provided by financing activities
|
|
(8,544,969)
|
10,248,053
|
|
(30,701,294)
|
|
|
|
|
|
|
NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
|
972,119
|
(28,575)
|
|
(8,582,798)
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS:
|
|
|
|
|
|
|
|
|
|
|
|
BEGINNING OF
PERIOD
|
|
1,965,967
|
1,994,542
|
|
10,577,340
|
|
|
|
|
|
|
END OF PERIOD
|
|
$2,938,086
|
$ 1,965,967
|
|
$ 1,994,542
|
|
|
|
GASCO
ENERGY, INC.
|
CONSOLIDATED STATEMENTS OF
OPERATIONS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31,
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
PRODUCTION INFORMATION
|
|
|
|
|
|
Gas
production
|
|
|
495,535
mcf
|
|
836,160
mcf
|
Gas
price
|
|
|
$3.53 per
mcf
|
|
$3.71 per
mcf
|
|
|
|
|
|
|
Oil
production
|
|
|
7,407
bbl
|
|
7,950
bbl
|
Oil
price
|
|
|
$72.79 per
bbl
|
|
$79.62 per
bbl
|
|
|
|
|
|
|
Equivalent production (mcfe)
|
|
|
539,977
|
|
883,860
|
|
|
|
|
|
|
REVENUES
|
|
|
|
|
|
Gas
|
|
|
$
1,747,716
|
|
$
3,100,944
|
Oil
|
|
|
539,192
|
|
632,961
|
Total
|
|
|
2,286,908
|
|
3,733,905
|
|
|
|
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
Lease operating
|
|
|
1,144,050
|
|
3,656,235
|
Transportation and processing
|
|
|
202,453
|
|
612,120
|
Depletion, depreciation and amortization
|
|
|
709,433
|
|
739,842
|
Impairment
|
|
|
7,415,000
|
|
-
|
General and administrative
|
|
|
1,146,980
|
|
1,836,492
|
Total
|
|
|
10,617,916
|
|
6,844,689
|
|
|
|
|
|
|
OPERATING EXPENSE
|
|
|
(8,331,008)
|
|
(3,110,784)
|
|
|
|
|
|
|
OTHER
INCOME (EXPENSE)
|
|
|
|
|
|
Interest expense
|
|
|
(1,781,384)
|
|
(1,707,918)
|
Derivative gains
|
|
|
1,210,000
|
|
288,403
|
Amortization of deferred income from sale of
assets
|
|
|
50,613
|
|
50,613
|
Interest income
|
|
|
1
|
|
6,882
|
Total
|
|
|
(520,770)
|
|
(1,362,020)
|
|
|
|
|
|
|
NET
LOSS
|
|
|
$(8,851,778)
|
|
$(4,472,804)
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
LOSS PER COMMON SHARE
BASIC AND DILUTED
|
|
|
$
(0.05)
|
|
$
(0.03)
|
Management believes net income or loss excluding the effect of
certain non-cash items such as derivative gains or losses,
impairment expense and gain related to sale of assets is a useful
metric to investors to show income before the impact of certain
non-cash items, and it provides a measure of the Company's cash
available to fund its business and operations. Investors should not
consider this measure, or other non-GAAP measures, in isolation or
as a substitute for net income or loss, operating income or loss,
cash flow from operations determined under GAAP or any other
measure for determining the Company's operating performance that is
calculated in accordance with GAAP. In addition, because net income
or loss excluding the effect of certain non-cash items is not a
GAAP measure, it may not necessarily be comparable to similarly
titled measures employed by other companies. A reconciliation of
net loss excluding the effect of certain non-cash items for the
three months and 12 months ended December
31, 2012 is provided in the table below:
|
|
|
|
|
|
Reconciliation of Net Loss to Non-GAAP Net Loss
Excluding Certain Non-cash Items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
Year
Ended
|
|
|
|
December 31, 2012
|
|
December 31, 2012
|
|
|
|
|
|
|
Net loss
as presented
|
|
$
(8,851,778)
|
|
$
(22,232,391)
|
|
|
|
|
|
|
|
Less:
non-cash derivative gain
|
|
$
(1,210,000)
|
|
$
(3,718,090)
|
|
|
|
|
|
|
|
Less: gain
on sale of assets
|
|
-
|
|
$
(2,567,574)
|
|
|
|
|
|
|
|
Add back:
property impairment
|
|
$
7,415,000
|
|
$
16,486,000
|
|
|
|
|
|
|
Net loss
excluding certain non-cash items
|
|
$
(2,646,778)
|
|
$
(12,032,055)
|
SOURCE Gasco Energy, Inc.