HOUSTON, Nov. 13, 2017 /PRNewswire/ -- Yuma Energy, Inc. (NYSE American: YUMA) (the "Company" or "Yuma") today announced its financial results for the quarter ended September 30, 2017.

Third Quarter 2017 Highlights

  • Net average production of 2,348 Boe/d for the third quarter of 2017, a 53.5 percent increase over the third quarter of 2016.
  • Cash provided by operations of $4,472,028 for the nine months ended September 30, 2017, compared to cash used in operations of $927,802 in the same period in 2016.
  • Yuma's Permian Basin acreage position has increased to 3,068 acres (2,685 net acres) in Yoakum County, Texas to horizontally develop the San Andres Oil Play. Yuma is the operator of the acreage with an 87.5 percent working interest, and has spud its salt water disposal well and intends to drill its first joint venture well in 2017, as well as continue to acquire additional acreage within its 33,280 acre Area of Mutual Interest ("AMI").
  • Yuma's borrowing base on its credit facility was reaffirmed on September 8, 2017 at $40.5 million, with the next scheduled redetermination set for April 1, 2018.

Recent Developments

  • Yuma closed its common stock offering of 9,600,000 shares of common stock on October 3, and subsequently on October 31, 2017, the Underwriters exercised their overallotment option and purchased 500,000 additional shares of common stock to bring the total gross proceeds of the offering to $10,100,000 before deducting underwriters' fees and offering expenses.

Management Comments

Sam L. Banks, CEO of Yuma Energy, Inc., commented, "We have continued to increase our acreage position in the Permian Basin at very attractive prices and are currently preparing to drill our first horizontal well and salt water disposal well in the San Andres horizontal oil play. We intend to finish drilling operations for both wells in 2017 and to establish commercial production during the first quarter of 2018.  We continue to believe that increasing our exposure to the Permian Basin, and more specifically the San Andres horizontal oil play, will lead to significant shareholder value over time.  As can be seen in the results of our first three quarters, the merger with Davis has improved our cash flows and financial position and significantly increased our production."

Financial Results

Production

The following table presents the net quantities of oil, natural gas and natural gas liquids produced and sold by us for the three and nine months ended September 30, 2017 and 2016, and the average sales price per unit sold.


Three Months Ended September 30,


Nine Months Ended September 30,


2017


2016


2017


2016

Production volumes:








Crude oil and condensate (Bbls)

57,134


32,242


199,774


106,257

Natural gas (Mcf)

757,361


507,521


2,442,899


1,553,906

Natural gas liquids (Bbls)

32,694


23,903


101,260


74,282

   Total (Boe) (1)

216,055


140,732


708,184


439,523

Average prices realized:








   Crude oil and condensate (per Bbl)

$47.86


$43.45


$48.42


$39.27

   Natural gas (per Mcf)

$3.04


$2.46


$3.05


$2.12

   Natural gas liquids (per Bbl)

$23.81


$16.66


$23.68


$14.96



(1)

Barrels of oil equivalent have been calculated on the basis of six thousand cubic feet (Mcf) of natural gas equal to one barrel of oil equivalent (Boe).

Revenues

The following table presents our revenues for the three and nine months ended September 30, 2017 and 2016.


Three Months Ended September 30,


Nine Months Ended September 30,


2017


2016


2017


2016

Sales of natural gas and crude oil:








Crude oil and condensate

$  2,734,269


$  1,400,837


$    9,673,049


$  4,172,477

Natural gas

2,304,154


1,249,148


7,445,564


3,295,258

Natural gas liquids

778,460


398,264


2,397,398


1,111,402

   Total revenues

$  5,816,883


$  3,048,249


$  19,516,011


$  8,579,137

Expenses

The Company's lease operating expenses ("LOE") and LOE per Boe for the three and nine month periods ended September 30, 2017 and 2016, are set forth below:


Three Months Ended September 30,


Nine Months Ended September 30,


2017


2016


2017


2016

Lease operating expenses

$1,506,747


$   810,115


$5,049,551


$2,043,298

Severance, ad valorem taxes and marketing

1,002,605


423,511


3,180,189


1,268,104

     Total LOE

$2,509,352


$1,233,626


$8,229,740


$3,311,402









LOE per Boe

$11.61


$8.77


$11.62


$7.53

LOE per Boe without severance, ad valorem taxes and marketing

$6.97


$5.76


$7.13


$4.65

Commodity Derivative Instruments

Commodity derivative instruments open as of September 30, 2017 are provided below.  Natural gas prices are NYMEX Henry Hub prices, and crude oil prices are NYMEX West Texas Intermediate.


2017


2018


2019


Settlement


Settlement


Settlement

NATURAL GAS (MMBtu):






Swaps






Volume

517,916


1,725,133


373,906

Price 

$3.13


$3.00


$3.00







3-way collars






Volume

41,712


-


-

Ceiling sold price (call) 

$3.39


-


-

Floor purchased price (put) 

$3.03


-


-

Floor sold price (short put) 

$2.47


-


-







CRUDE OIL (Bbls):






Swaps






Volume

31,927


195,152


156,320

Price 

$52.24


$53.17


$53.77







3-way collars






Volume

26,637


-


-

Ceiling sold price (call) 

$77.00


-


-

Floor purchased price (put) 

$60.00


-


-

Floor sold price (short put) 

$45.00


-


-

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 operations have focused on onshore properties located in central and southern Louisiana and southeastern Texas where it has a long history of drilling, developing and producing both oil and natural gas assets.  More recently, the Company has begun acquiring acreage in Yoakum County, Texas, with plans to explore and develop oil and natural gas assets in the Permian Basin.  Finally, the Company has operated positions in Kern County, California, and non-operated positions in the East Texas Woodbine and the Bakken Shale in North Dakota.  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"). 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 forward-looking statements include statements about future operations, and estimates of reserve and production volumes. Forward-looking statements are based on current expectations and assumptions and analyses made by the Company in light of experience and perception of historical trends, current conditions and expected future developments, as well as other factors appropriate under the circumstances. However, whether actual results and developments will conform with expectations is subject to a number of risks and uncertainties, including but not limited to: the risks of the oil and gas industry (for example, operational risks in exploring for, developing and producing crude oil and natural gas); risks and uncertainties involving geology of oil and natural gas deposits; the uncertainty of reserve estimates; revisions to reserve estimates as a result of changes in commodity prices; the uncertainty of estimates and projections relating to future production, costs and expenses; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; health, safety and environmental risks and risks related to weather; further declines in oil and natural gas prices; inability of management to execute its plans to meet its goals, shortages of drilling equipment, oil field personnel and services, unavailability of gathering systems, pipelines and processing facilities and the possibility that government policies may change.  The Company's annual report on Form 10-K for the year ended December 31, 2016, recent quarterly reports on Form 10-Q, recent current reports on Form 8-K, and other Securities and Exchange Commission 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.

 

Yuma Energy, Inc.


CONSOLIDATED BALANCE SHEETS

(Unaudited)



September 30,


December 31,


2017


2016





ASSETS 








CURRENT ASSETS:




Cash and cash equivalents 

$        270,359


$    3,625,686

Accounts receivable, net of allowance for doubtful accounts:




Trade

3,893,803


4,827,798

Officers and employees

48,575


68,014

Common stock subscription receivable

8,690,400


-

Other

1,186,320


1,757,337

Commodity derivative instruments

359,965


-

Prepayments

347,529


1,063,418

Other deferred charges

437,165


284,305





Total current assets

15,234,116


11,626,558





OIL AND GAS PROPERTIES (full cost method):




Proved properties

490,280,184


488,723,905

Unproved properties - not subject to amortization

5,584,644


3,656,989






495,864,828


492,380,894

Less:  accumulated depreciation, depletion and amortization

(418,916,482)


(410,440,433)





Net oil and gas properties

76,948,346


81,940,461





OTHER PROPERTY AND EQUIPMENT:




Land, buildings and improvements

1,600,000


1,600,000

Other property and equipment

2,845,459


7,136,530


4,445,459


8,736,530

Less: accumulated depreciation and amortization

(1,369,302)


(5,349,145)





Net other property and equipment

3,076,157


3,387,385





OTHER ASSETS AND DEFERRED CHARGES:




Commodity derivative instruments

415,091


-

Deposits

467,592


467,306

Other noncurrent assets

333,587


517,201





Total other assets and deferred charges

1,216,270


984,507





TOTAL ASSETS 

$   96,474,889


$  97,938,911

 

Yuma Energy, Inc.


CONSOLIDATED BALANCE SHEETS – CONTINUED

(Unaudited)



September 30,


December 31,


2017


2016





LIABILITIES AND EQUITY








CURRENT LIABILITIES:




Current maturities of debt

$                    -


$       599,341

Accounts payable, principally trade

12,922,251


11,009,631

Commodity derivative instruments

-


1,340,451

Asset retirement obligations

359,659


376,735

Other accrued liabilities

1,875,211


2,572,680





Total current liabilities

15,157,121


15,898,838





LONG-TERM DEBT

31,450,000


39,500,000





OTHER NONCURRENT LIABILITIES:




Asset retirement obligations

9,717,448


9,819,648

Commodity derivative instruments

-


1,215,551

Deferred rent

286,907


-

Employee stock awards

93,669


-





Total other noncurrent liabilities

10,098,024


11,035,199





COMMITMENTS AND CONTINGENCIES (Note 14)








EQUITY




Series D convertible preferred stock ($0.001 par value, 7,000,000 authorized, 1,871,373 issued as of September 30, 2017, and 1,776,718 issued as of December 31, 2016, $11.07 per share liquidation preference)

1,872


1,777

Common stock ($0.001 par value, 100 million shares authorized, 12,559,608 outstanding as of September 30, 2017 and 12,201,884 outstanding as of December 31, 2016)

12,560


12,202

Common stock subscribed (9,600,000 shares, funds received October 3, 2017)

9,600


-

Additional paid-in capital

54,035,879


43,877,563

Treasury stock at cost (12,433 shares as of September 30, 2017 and -0- shares as of December 31, 2016)

(24,432)


-

Accumulated earnings (deficit)

(14,265,735)


(12,386,668)





Total equity

39,769,744


31,504,874





TOTAL LIABILITIES AND EQUITY

$   96,474,889


$  97,938,911

 

Yuma Energy, Inc.


CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



Three Months Ended September 30,


Nine Months Ended September 30,


2017


2016


2017


2016









REVENUES:








Sales of natural gas and crude oil

$  5,816,883


$  3,048,249


$ 19,516,011


$    8,579,137









EXPENSES:








Lease operating and production costs

2,509,352


1,233,626


8,229,740


3,311,402

General and administrative – stock-based compensation

414,660


380,460


851,492


1,664,855

General and administrative – other

1,622,528


1,717,627


5,705,159


8,153,874

Depreciation, depletion and amortization

2,761,668


1,524,877


8,666,052


5,357,207

Asset retirement obligation accretion expense

138,867


51,885


418,890


158,960

Impairment of oil and gas properties

-


12,735


-


17,560,918

Bad debt expense net of recoveries

(38,706)


16,602


34,807


32,352

Total expenses

7,408,369


4,937,812


23,906,140


36,239,568









LOSS FROM OPERATIONS

(1,591,486)


(1,889,563)


(4,390,129)


(27,660,431)









OTHER INCOME (EXPENSE):








Net gains (losses) from commodity derivatives

(1,260,280)


128,177


4,434,583


(161,161)

Interest expense

(429,313)


(81,168)


(1,407,689)


(195,006)

Gain (loss) on other property and equipment

-


-


484,768


-

Other, net

14,043


1,157


56,110


14,622

Total other income (expense)

(1,675,550)


48,166


3,567,772


(341,545)









INCOME (LOSS) BEFORE INCOME TAXES

(3,267,036)


(1,841,397)


(822,357)


(28,001,976)









Income tax expense

2,539


33,635


8,489


6,866









NET INCOME (LOSS)

(3,269,575)


(1,875,032)


(830,846)


(28,008,842)









PREFERRED STOCK:








Dividends paid in kind

359,311


335,199


1,048,221


981,347









NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

$ (3,628,886)


$ (2,210,231)


$ (1,879,067)


$ (28,990,189)









INCOME (LOSS) PER COMMON SHARE:








Basic

($0.29)


($0.30)


($0.15)


($3.89)

Diluted

($0.29)


($0.30)


($0.15)


($3.89)









WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:








Basic

12,483,724


7,444,542


12,311,087


7,446,986

Diluted

12,483,724


7,444,542


12,311,087


7,446,986

 

Yuma Energy, Inc.


CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)



Nine Months Ended September 30,


2017


2016

CASH FLOWS FROM OPERATING ACTIVITIES:




Reconciliation of net income (loss) to net cash provided by (used in) operating activities:




Net income (loss)

$    (830,846)


$ (28,008,842)

Depreciation, depletion and amortization of property and equipment

8,666,052


5,357,207

Impairment of oil and gas properties

-


17,560,918

Amortization of debt issuance costs

277,293


-

Net deferred income tax expense

-


6,866

Deferred rent liability, net

163,962


-

Stock-based compensation expense

851,492


1,664,855

Settlement of asset retirement obligations

(430,415)


(17,890)

Accretion of asset retirement obligation

418,890


158,960

Bad debt expense

34,807


32,352

Net (gains) losses from commodity derivatives

(4,434,583)


161,161

Gain on sales of fixed assets

(556,141)


-

Loss on write-off of abandoned facilities

71,373


-

Gain on write-off of liabilities net of assets

(34,835)


-

Changes in assets and liabilities:




Decrease in accounts receivable

736,959


2,988,184

(Increase) decrease in prepaids, deposits and other assets

715,603


656,948

(Decrease) increase in accounts payable and other current and non-current liabilities

(1,177,583)


(1,488,521)

NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES

4,472,028


(927,802)





CASH FLOWS FROM INVESTING ACTIVITIES:




Capital expenditures for oil and gas properties

(5,964,781)


(9,878,724)

Proceeds from sale of oil and gas properties

5,400,563


-

Proceeds from sale of other fixed assets

645,791


-

Derivative settlements

1,103,525


1,319,517

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES

1,185,098


(8,559,207)





CASH FLOWS FROM FINANCING ACTIVITIES:




Proceeds from borrowings

-


9,000,000

Net repayments on the senior credit facility

(8,050,000)


-

Repayments of borrowings - insurance financing

(599,341)


-

Debt issuance costs

(323,593)


-

Costs for common stock offering

(15,087)


-

Treasury stock repurchases

(24,432)


(408,323)

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES

(9,012,453)


8,591,677





NET DECREASE IN CASH AND CASH EQUIVALENTS

(3,355,327)


(895,332)





CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

3,625,686


4,064,094





CASH AND CASH EQUIVALENTS AT END OF PERIOD

$     270,359


$    3,168,762





Supplemental disclosure of cash flow information:




Interest payments (net of interest capitalized)

$  1,021,249


$       193,985

Income tax refund

$       20,699


$                   -

Supplemental disclosure of significant non-cash activity:




(Increase) decrease in capital expenditures financed by accounts payable

$ (3,291,386)


$       498,140

Common stock subscription receivable (net of $909,600 offering costs at closing)

$  8,690,400


$                   -

Other accrued offering expenses

$     271,227


$                   -

 

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SOURCE Yuma Energy, Inc.