Welcome!

News Feed Item

Synergy Resources Reports Fiscal First Quarter 2014 Results

Revenues up 132% to $19.3 Million, Driving Operating Income up 103% to $7.2 Million and Net Income of $0.08 per Diluted Share; Company to Host Investor Conference Call Today, January 7, 2014 at 12:00 p.m. ET

PLATTEVILLE, CO -- (Marketwired) -- 01/07/14 -- Synergy Resources Corporation (NYSE MKT: SYRG), a U.S. oil and gas exploration and production company focused on the Denver-Julesburg Basin, reported its fiscal first quarter results for the period ended November 30, 2013.

First Quarter 2014 Financial Highlights vs. Same Year-Ago Quarter

  • Revenues increased 132% to $19.3 million
  • Operating income improved 103% to $7.2 million
  • Net income increased 173% to $6.1 million or $0.08 per share
  • Adjusted EBITDA (a non-GAAP metric) totaled $12.8 million, up 113%, representing a 67% return on revenue
  • At November 30, 2013, cash and equivalents and short term investments totaled $61 million, borrowings were $37 million

First Quarter 2014 Operational Highlights

  • Net oil and natural gas production increased 93% to 291,904 barrels of oil equivalent (BOE), averaging 3,208 BOE per day versus 1,658, as compared to the same year-ago quarter
  • As operator, drilled 6 horizontal wells during the quarter, increasing the total number of horizontal wells drilled as operator to 11, with 5 wells brought into production
  • Closed on the purchase of assets from Apollo Operating, LLC and Trilogy Resources, LLC, adding to the company's acreage and production profile in the core Wattenberg Field
  • Purchased remaining interest in Class II disposal well in Wattenberg Field
  • As of November 30, 2013, the company had completed, acquired or participated in a total of 361 gross producing oil and gas wells

First Quarter 2014 Financial Results

Revenues totaled $19.3 million, up 31% from $14.7 million in the previous quarter and up 132% from $8.3 million in the same quarter a year ago. The year-over-year improvement was attributed to a 93% increase in production, primarily from the new wells brought on line, and by a 20% increase in the realized average selling price per BOE. During fiscal Q1 2014, average selling prices were $93.06 per barrel of oil and $4.86 per mcf of gas, as compared to $81.03 and $4.27, respectively, a year-ago.

Operating income increased to $7.2 million, up 9% from $6.7 million in the previous quarter and up 103% from $3.5 million in the same year-ago period. Net income increased to $6.1 million or $0.08 per basic and diluted share, up from $1 million or $0.02 per basic and $.01 per diluted share in the previous quarter and up 177% from $2.2 million or $0.04 per basic and $0.04 per diluted share in the same year ago period.

Adjusted EBITDA increased to $12.8 million, up 21% from $10.6 million in the previous quarter and up 113% from $6.0 million in the same year-ago quarter.

As of November 30, 2013, the company's cash and equivalents and short term investments totaled $61 million, as compared to $12.5 million at November 30, 2012. At November 30, 2013, there was $38 million available to borrow under the revolving line of credit.

The following table presents certain per unit metrics that compare results of the corresponding quarterly reporting periods:

                                            Three Months Ended
                                       ---------------------------
                                       Nov. 30, 2013 Nov. 30, 2012 % Change
                                       ------------- ------------- --------
Production:
  Oil (Bbls)                                 168,278        80,301      110%
  Gas (McF)                                  741,755       423,646       75%
  BOE (Bbls)                                 291,904       150,909       93%

Revenues (in thousands):
  Oil                                  $      15,660 $       6,507      141%
  Gas                                          3,606         1,807      100%
                                       ------------- -------------
    Total                              $      19,266 $       8,314      132%
                                       ============= =============

Average sales price:
  Oil                                  $       93.06 $       81.03       15%
  Gas                                  $        4.86 $        4.27       14%
  BOE (Bbls)                           $       66.00 $       55.09       20%

* "Bbl" refers to one stock tank barrel, or 42 U.S. gallons liquid volume in reference to crude oil or other liquid hydrocarbons. "Mcf" refers to one thousand cubic feet. A BOE (i.e. barrel of oil equivalent) combines Bbls of oil and Mcf of gas by converting each six Mcf of gas to one Bbl of oil.

Fiscal 2014 Outlook

Management anticipates updated CAPEX spending of $189 million on the following programs with the vast majority of the drilling expenditures weighted towards the horizontal drilling program in the Wattenberg Field. The company anticipates funding this program with cash on hand, additional borrowing under its credit facility and cash flow from revenues.

  • $127.5 million to drill horizontal wells as operator
  • $4 million to drill vertical wells as operator
  • $22.5 million to participate as a non-operator to drill approximately 5 net horizontal wells to Synergy's interest
  • $5 million for land leasing
  • $30 million cash for acquisitions

Events Subsequent to November 30, 2013

Increased the credit facility with Community Banks of Colorado to $300 million from $150 million and increased borrowing base to $90 million up from $75 million due to the increase in proved reserves PV10 value to $236 million

Completed 6 horizontal wells on the Leffler pad in late December, wells were in initial flow back status prior to December 31, 2013

Contracted with Ensign Drilling Company of North America for the use of Ensign Rig #131, a natural gas powered rig, for all of calendar 2014 under turn-key pricing terms that allow for more efficient and environmentally friendly drilling operations

Began two rig horizontal drilling program with the spudding of the first well on the Union pad with Ensign Rig #131 while Ensign Rig #17 spudded the fourth well on the Phelps pad

Entered into crude oil contracts with various purchasers at a discount to NYMEX ranging from $11.50-$14.90 for 2014

Conference Call

Synergy Resources will host a conference call later this morning, Tuesday, January 7, 2014 at 12:00 p.m. Eastern time (10:00 a.m. Mountain time) to discuss its fiscal first quarter 2014 results. President and CEO Ed Holloway, Executive Vice President William Scaff, Jr., CFO Monty Jennings and VP of Operations Craig Rasmuson will host the presentation, followed by a question and answer period.

Date: Tuesday, January 7, 2014
Time: 12:00 p.m. Eastern time (10:00 a.m. Mountain time)
Domestic Dial-In #: 1-877-407-9122
International Dial-In #: 1-201-493-6747
The conference call will be broadcast simultaneously which you can access via this link: http://syrginfo.equisolvewebcast.com/q1-2014 and via the investor section of the company's web site at www.syrginfo.com.

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Jon Kruljac at 970-737-1073.

A replay of the call will be available after 3:00 p.m. Eastern time on the same day and until January 21, 2014.

Domestic Toll-free Replay # 1-877-660-6853
International replay number: 1-201-612-7415
Replay ID #411931

About Synergy Resources Corporation

Synergy Resources Corporation is a domestic oil and natural gas exploration and production company. Synergy's core area of operations is in the Denver-Julesburg Basin, which encompasses Colorado, Wyoming, Kansas, and Nebraska. The Wattenberg field in the D-J Basin ranks as one of the most productive fields in the U.S. The company's corporate offices are located in Platteville, Colorado. More company news and information about Synergy Resources is available at www.syrginfo.com.

Important Cautions Regarding Forward Looking Statements

This press release may contain forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. The use of words such as "believes", "expects", "anticipates", "intends", "plans", "estimates", "should", "likely" or similar expressions, indicates a forward-looking statement. These statements are subject to risks and uncertainties and are based on the beliefs and assumptions of management, and information currently available to management. The actual results could differ materially from a conclusion, forecast or projection in the forward-looking information. Certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information. The identification in this press release of factors that may affect the company's future performance and the accuracy of forward-looking statements is meant to be illustrative and by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. Factors that could cause the company's actual results to differ materially from those expressed or implied by forward-looking statements include, but are not limited to: the success of the company's exploration and development efforts; the price of oil and gas; worldwide economic situation; change in interest rates or inflation; willingness and ability of third parties to honor their contractual commitments; the company's ability to raise additional capital, as it may be affected by current conditions in the stock market and competition in the oil and gas industry for risk capital; the company's capital costs, which may be affected by delays or cost overruns; costs of production; environmental and other regulations, as the same presently exist or may later be amended; the company's ability to identify, finance and integrate any future acquisitions; and the volatility of the company's stock price.

About Non-GAAP Financial Measures

The company uses "adjusted EBITDA," a non-GAAP financial measure, for internal managerial purposes when evaluating period-to-period comparisons. This measure is not a measure of financial performance under U.S. GAAP and should be considered in addition to, not as a substitute for, cash flows from operations, investing, or financing activities, net income, nor as a liquidity measure or indicator of cash flows or an indicator of operating performance reported in accordance with U.S. GAAP. The non-GAAP financial measures that the company uses may not be comparable to measures with similar titles reported by other companies. Also, in the future, the company may disclose different non-GAAP financial measures in order to help investors more meaningfully evaluate and compare the company's future results of operations to its previously reported results of operations. The company strongly encourages investors to review its financial statements and publicly-filed reports in their entirety and not rely on any single financial measure. See, "Reconciliation of Non-GAAP Financial Measures," below for a detailed description of these measures as well as a reconciliation of each to the nearest U.S. GAAP measure.

Reconciliation of Non-GAAP Financial Measures

The company defines adjusted EBITDA as net income (loss) adjusted to exclude the impact of interest expense, interest income, income taxes, depreciation, depletion and amortization for the period, and stock based compensation, plus/minus the change in fair value of derivative assets or liabilities. The company believes adjusted EBITDA is relevant because it is a measure of cash available to fund capital expenditures and service debt and is a metric used by some industry analysts to provide a comparison of its results with its peers. The following table presents a reconciliation of each of the company's non-GAAP financial measures to the nearest GAAP measure.


                                                     Three Months Ended
                                                  November 30   November 30
                                                     2013          2012
                                                 ------------  ------------
Adjusted EBITDA:
  Net income                                     $      6,100  $      2,238
  Depreciation, depletion and amortization              5,591         2,320
  Provision for income tax                              3,387         1,315
  Stock based compensation                                419           168
  Commodity derivative change                          (2,636)            -
  Interest Expense                                          -             -
  Interest income                                         (31)           (7)
                                                 ------------  ------------
    Adjusted EBITDA                              $     12,830  $      6,034
                                                 ============  ============


Financial Statements

Financial statements are included below. Additional financial information, including footnotes that are considered an integral part of the financial statements, will be included in Synergy's Edgar Filings at www.sec.gov on Form 10-Q for the period ended November 30, 2013.


                        SYNERGY RESOURCES CORPORATION
                     CONDENSED STATEMENTS OF OPERATIONS
              (unaudited, in thousands, except per share data)

                                                       Three Months Ended
                                                    November 30  November 30
                                                       2013         2012
                                                   ------------ ------------

Oil and gas revenues                               $     19,266 $      8,314
                                                   ------------ ------------
Expenses:
  Direct operating expenses                               3,289        1,337
  Depreciation, depletion, and amortization               5,591        2,320
  General and administrative                              3,168        1,111
                                                   ------------ ------------
    Total expenses                                       12,048        4,768
                                                   ------------ ------------
Operating income                                          7,218        3,546
                                                   ------------ ------------


Commodity derivative gain/(loss)                          2,238            -
Interest Income                                              31            7
Deferred income tax provision                             3,387        1,315
                                                   ------------ ------------

Net income                                         $      6,100 $      2,238
                                                   ============ ============

Net income per common share:
  Basic                                            $       0.08 $       0.04
                                                   ============ ============
  Diluted                                          $       0.08 $       0.04

Weighted average shares outstanding:
  Basic                                              73,674,865   51,661,704
                                                   ============ ============
  Diluted                                            76,044,605   53,616,182




                       SYNERGY RESOURCES CORPORATION
                          CONDENSED BALANCE SHEETS
                               (in thousands)

                                                  November 30    August 31
                                                     2013          2013
                                                 ------------  ------------
                                                  (unaudited)

                     ASSETS
Cash and cash equivalents                        $     20,973  $     19,463
Short-term investments
                                                 $     40,032  $     60,018
Other current assets                                   15,727        42,494
                                                 ------------  ------------
  Total current assets                                 76,732        91,975
                                                 ------------  ------------
Oil and gas properties and other equipment            261,478       197,965
Other assets                                              602         1,296
                                                 ------------  ------------
    Total assets                                 $    338,812  $    291,236
                                                 ============  ============

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities                              $     44,895  $     41,367
Revolving credit facility                              37,000        37,000
Deferred tax liability, net                             9,925         6,538
Asset retirement obligations                            3,540         2,777
Commodity derivative                                       81           334
                                                 ------------  ------------
  Total liabilities                                    95,441        88,016
                                                 ------------  ------------
Shareholders' equity:
  Common stock and paid-in capital                    250,512       216,454
  Accumulated deficit                                  (7,141)      (13,234)
                                                 ------------  ------------
    Total shareholders' equity                        243,371       203,220
                                                 ------------  ------------
      Total liabilities and shareholders' equity $    338,812  $    291,236
                                                 ============  ============




                       SYNERGY RESOURCES CORPORATION
                     CONDENSED STATEMENTS OF CASH FLOWS
              (unaudited, in thousands, except per share data)

                                                     Three Months Ended
                                                  November 30   November 30
                                                     2013          2012
                                                 ------------  ------------

Cash flows from operating activities:
  Net income                                     $      6,100  $      2,238
                                                 ------------  ------------
  Adjustments to reconcile net income to net
   cash provided by operating activities:
    Depreciation, depletion, and amortization           5,591         2,320
    Provision for deferred taxes                        3,387         1,315
    Valuation (increase) decrease in commodity
     derivatives                                       (2,636)            -
    Other, non-cash items                                 419           168
    Changes in operating assets and liabilities         2,052        (3,272)
                                                 ------------  ------------
  Total adjustments                                     8,813           531
                                                 ------------  ------------
    Net cash provided by operating activities          14,913         2,769
                                                 ------------  ------------
Cash flows from investing activities:
  Acquisition of property and equipment               (57,127)      (12,220)
  Short-term investments                               19,987
                                                 ------------  ------------
  Net cash used in investing activities               (37,140)      (12,220)
                                                 ------------  ------------
Cash flows from financing activities:
  Proceeds from exercise of warrants                   23,771           146
  Proceeds from revolving credit facility                   -         2,486
  Other financing activities                              (34)            -
                                                 ------------  ------------
  Net cash provided by financing activities            23,737         2,632
                                                 ------------  ------------
Net increase (decrease) in cash and equivalents         1,510        (6,819)
Cash and equivalents at beginning of period            19,463        19,284
                                                 ------------  ------------
Cash and equivalents at end of period            $     20,973  $     12,465
                                                 ============  ============


Company Contact:
Rhonda Sandquist
Synergy Resources Corporation
Tel (970) 737-1073
Email: [email protected]

Investor Relations Contact:
Jon Kruljac
Synergy Resources Corporation
Tel (303) 840-8166
Email: [email protected]

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Here are the Top 20 Twitter Influencers of the month as determined by the Kcore algorithm, in a range of current topics of interest from #IoT to #DeepLearning. To run a real-time search of a given term in our website and see the current top influencers, click on the topic name. Among the top 20 IoT influencers, ThingsEXPO ranked #14 and CloudEXPO ranked #17.
While the focus and objectives of IoT initiatives are many and diverse, they all share a few common attributes, and one of those is the network. Commonly, that network includes the Internet, over which there isn't any real control for performance and availability. Or is there? The current state of the art for Big Data analytics, as applied to network telemetry, offers new opportunities for improving and assuring operational integrity. In his session at @ThingsExpo, Jim Frey, Vice President of S...
Given the popularity of the containers, further investment in the telco/cable industry is needed to transition existing VM-based solutions to containerized cloud native deployments. The networking architecture of the solution isolates the network traffic into different network planes (e.g., management, control, and media). This naturally makes support for multiple interfaces in container orchestration engines an indispensable requirement.
Your homes and cars can be automated and self-serviced. Why can't your storage? From simply asking questions to analyze and troubleshoot your infrastructure, to provisioning storage with snapshots, recovery and replication, your wildest sci-fi dream has come true. In his session at @DevOpsSummit at 20th Cloud Expo, Dan Florea, Director of Product Management at Tintri, provided a ChatOps demo where you can talk to your storage and manage it from anywhere, through Slack and similar services with...
Containers are rapidly finding their way into enterprise data centers, but change is difficult. How do enterprises transform their architecture with technologies like containers without losing the reliable components of their current solutions? In his session at @DevOpsSummit at 21st Cloud Expo, Tony Campbell, Director, Educational Services at CoreOS, will explore the challenges organizations are facing today as they move to containers and go over how Kubernetes applications can deploy with lega...
In their session at @DevOpsSummit at 21st Cloud Expo, Michael Berman, VP Engineering at TidalScale, and Ivo Jimenez, Engineer at TidalScale, will describe how automating tests in TidalScale is easy thanks to WaveRunner. They will show how they use WaveRunner, Jenkins, and Docker to have agile delivery of TidalScale. Michael Berman is VP Engineering at TidalScale. TidalScale is developing a scale up compute and resource architecture for customers to perform big data exploration and real time anal...
With the introduction of IoT and Smart Living in every aspect of our lives, one question has become relevant: What are the security implications? To answer this, first we have to look and explore the security models of the technologies that IoT is founded upon. In his session at @ThingsExpo, Nevi Kaja, a Research Engineer at Ford Motor Company, discussed some of the security challenges of the IoT infrastructure and related how these aspects impact Smart Living. The material was delivered interac...
Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settlement products to hedge funds and investment banks. After, he co-founded a revenue cycle management company where he learned about Bitcoin and eventually Ethereal. Andrew's role at ConsenSys Enterprise is a mul...
Companies are harnessing data in ways we once associated with science fiction. Analysts have access to a plethora of visualization and reporting tools, but considering the vast amount of data businesses collect and limitations of CPUs, end users are forced to design their structures and systems with limitations. Until now. As the cloud toolkit to analyze data has evolved, GPUs have stepped in to massively parallel SQL, visualization and machine learning.
Learn how to solve the problem of keeping files in sync between multiple Docker containers. In his session at 16th Cloud Expo, Aaron Brongersma, Senior Infrastructure Engineer at Modulus, discussed using rsync, GlusterFS, EBS and Bit Torrent Sync. He broke down the tools that are needed to help create a seamless user experience. In the end, can we have an environment where we can easily move Docker containers, servers, and volumes without impacting our applications? He shared his results so yo...
"This week we're really focusing on scalability, asset preservation and how do you back up to the cloud and in the cloud with object storage, which is really a new way of attacking dealing with your file, your blocked data, where you put it and how you access it," stated Jeff Greenwald, Senior Director of Market Development at HGST, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Enterprise architects are increasingly adopting multi-cloud strategies as they seek to utilize existing data center assets, leverage the advantages of cloud computing and avoid cloud vendor lock-in. This requires a globally aware traffic management strategy that can monitor infrastructure health across data centers and end-user experience globally, while responding to control changes and system specification at the speed of today’s DevOps teams. In his session at 20th Cloud Expo, Josh Gray, Chie...
FinTechs use the cloud to operate at the speed and scale of digital financial activity, but are often hindered by the complexity of managing security and compliance in the cloud. In his session at 20th Cloud Expo, Sesh Murthy, co-founder and CTO of Cloud Raxak, showed how proactive and automated cloud security enables FinTechs to leverage the cloud to achieve their business goals. Through business-driven cloud security, FinTechs can speed time-to-market, diminish risk and costs, maintain continu...
Docker containers have brought great opportunities to shorten the deployment process through continuous integration and the delivery of applications and microservices. This applies equally to enterprise data centers as well as the cloud. In his session at 20th Cloud Expo, Jari Kolehmainen, founder and CTO of Kontena, discussed solutions and benefits of a deeply integrated deployment pipeline using technologies such as container management platforms, Docker containers, and the drone.io Cl tool. H...
Kubernetes is a new and revolutionary open-sourced system for managing containers across multiple hosts in a cluster. Ansible is a simple IT automation tool for just about any requirement for reproducible environments. In his session at @DevOpsSummit at 18th Cloud Expo, Patrick Galbraith, a principal engineer at HPE, discussed how to build a fully functional Kubernetes cluster on a number of virtual machines or bare-metal hosts. Also included will be a brief demonstration of running a Galera MyS...