Ellora Energy Announces Third Quarter and Nine Months Financial Results
DENVER, Feb. 19 /PRNewswire/ -- Ellora Energy, Inc. (Ellora) an independent oil and gas company, today announced its third quarter 2009 and nine months financial and operating results.
HIGHLIGHTS
- Increased third quarter production 21%
- Reduced total bank debt by $34.0 million from year-end 2008
- Generated positive free cash flow in the first nine months of the year
- Entered into two joint ventures in the Haynesville to hold acreage and accelerate the drilling of wells
- Subsequent Event: Closed Sale of Hugoton Field Assets for $247 Million (February 1, 2010)
For the third quarter ended September 30, 2009, Ellora Energy reported a net loss of $4.0 million compared to net income of $31.5 million for the same period a year ago. Revenues for the third quarter 2009 were $24.4 million compared to $41.8 million for the corresponding period the previous year. EBITDAX (a non-GAAP measure) for the third quarter 2009 was $21.0 million and cash flow from operations was $18.1 million. Decreased revenues were primarily the result of third quarter prices for oil and natural gas that were lower by 42% and 61%, respectively, as compared to the prior year.
During the third quarter of 2009 Ellora Energy amended an existing drilling rig commitment. The Company agreed to make a $2.0 million payment in the fourth quarter of 2009, which is reflected as an accrued liability at the end of the third quarter, and recorded an additional liability in the amount of $1.9 million to recognize the value of the contract amendment. Both of these charges were accrued to exploration expense as of September 30, 2009 and the net loss for the third quarter of 2009 would have been reduced to $1.5 million excluding these one-time charges.
Production for the three month period ended September 30, 2009 increased 21% to 44.4 million cubic feet equivalent per day (Mmcfe/d). Natural gas production totaled 29.3 Mmcf/d, split between the Company's Kansas/Colorado and Texas/Louisiana properties by 54% and 46%, respectively. Oil production totaled 2,511 barrels of oil per day (Bopd), essentially all from Kansas, representing a 34% increase from the corresponding year-ago period.
Steve Enger, President and Chief Operating Officer of Ellora, said, "Despite a challenging operating environment and a significant decrease in our capital program, Ellora generated a 21% increase in quarterly production. In fact, strong results in Kansas enabled us to maintain production at a high level in 2009 with only one drilling rig running, in contrast to 2008 when four rigs were operating company-wide."
The average realized price for oil and gas, on an equivalent basis, was $5.56 per thousand cubic feet equivalent (Mcfe) for the third quarter of 2009, down 50% from the year prior. Realized prices for oil and natural gas were $61.22/bbl and $3.17/Mcf in the third quarter, down 42% and 61% from the prior year, respectively. Hedges in place improved the overall price realization from $5.56/Mcfe to $7.59/Mcfe and added $8.3 million to reported EBITDAX and cash flow from operations for the third quarter and $15.5 million to the nine-month results.
Unit lease operating expense for the third quarter of 2009 was $1.31/Mcfe ($1.53/Mcfe including production taxes), down 29% from the third quarter of 2008 as production volumes increased and workover expense decreased. Cash general and administrative (G&A) costs were $0.93/Mcfe (G&A was $1.15/Mcfe including non-cash compensation costs), down 30% from the prior year, as the Company reduced staff and other administrative costs while equivalent production increased 21%. The unit depreciation, depletion and amortization (DD&A) cost was $2.63/Mcfe, down from $2.96/Mcfe for the third quarter of 2008 reflecting an impairment charge of $88.9 million that was recorded in the second quarter of 2009 and decreases in the proved reserves used to calculate DD&A, offset by the 21% increase in production. Exploration expense was $4.2 million, including $262,000 of dry hole costs, and interest expense was $1.4 million. Total capital invested for drilling during the quarter was $5.0 million compared to $20.8 million in the corresponding year-ago period.
During the third quarter of 2009, Ellora entered into a joint venture agreement with EOG Resources, Inc. ("EOG") covering approximately 1,900 acres in East Texas. Under the terms of the agreement, Ellora retained a 30% working interest, an approximate 4% overriding royalty interest and received additional consideration comprised of cash and well carries. The first Haynesville well under this agreement was spud in the third quarter. This agreement follows a joint venture signed with EOG in the second quarter of 2009 that covered approximately 5,200 net acres, representing substantially all of Ellora's Haynesville acreage in Louisiana. Under that joint venture, EOG agreed to carry Ellora on multiple Haynesville wells and paid additional cash consideration for a 70% working interest. The first Haynesville well under that joint venture also spud in the third quarter. Drilling under the joint ventures allowed Ellora to retain Haynesville acreage that was otherwise facing near-term expiration.
As mentioned previously, Ellora Energy operated one rig in Kansas in the third quarter of 2009 and none in East Texas or Louisiana, drilling nine gross (8.2 net) wells, as compared to operating two rigs in the corresponding 2008 period in each of its Kansas and East Texas properties. Four of the wells drilled in the third quarter of 2009 were successful, including two drilled to complete the line-drive waterflood pattern in the existing Southwest Lemon Victory Waterflood Unit. Total capital invested for lease acquisition during the third quarter of 2009 was $701,000 as compared to $10.9 million for the comparable period in 2008. The Haynesville Shale accounts for the majority of the Company's lease acquisition activity.
Nine Months Ended September 30, 2009
For the nine month period, Ellora Energy reported a net loss of $73.9 million, including a one-time non-cash charge relating to the Company's producing properties in East Texas, compared to net income of $15.4 million for the corresponding 2008 period. Revenues for the nine month period were $66.2 million compared to $113.0 million for the comparable 2008 period. Decreased revenues were primarily the result of a significant reduction in oil and natural gas prices for the nine month period of 54% and 63%, respectively. Despite the significant reduction in capital expenditures during the 2009 period, Ellora Energy generated a 35% increase in production.
EBITDAX for the nine month period was $42.5 million and cash flow from operations was $27.7 million, well in excess of capital spending for the nine months of $18.6 million. As a result of generating free cash flow and the Convertible Preferred Stock offering completed in the first quarter of 2009, by the end of the third quarter of 2009 Ellora had reduced bank debt by $34.0 million since year-end 2008, including a reduction of $3.0 million to the debt balance in the third quarter of 2009.
Proved Reserves
Ellora undertook a mid-year reserve review by the Company's independent reserve engineer which estimated the Company's Proved Reserves, using SEC guidelines, at 119 billion cubic feet of natural gas equivalent (Bcfe). Sixty percent of the Proved Reserves were classified as Proved Developed Producing and 40% as Proved Undeveloped with 64% being natural gas. Proved Reserves fell from 194 Bcfe to 119 Bcfe primarily as the result of NYMEX benchmark gas price dropping from $5.71 per million British Thermal Units (MMBtu) at year-end 2008 to $3.89/MMBtu at mid-year 2009. Proved reserves in Texas/Louisiana were 46 Bcfe, including no contribution from the Haynesville or Bossier formations, with 73 Bcfe in Kansas/Colorado.
T. Scott Martin, Chairman and Chief Executive Officer commented, "We are very pleased with our operational and financial performance in the third quarter of 2009 and for the first nine months of the year in response to sharply declining commodity prices, particularly natural gas. Not only did we live within cash flow, we generated free cash flow in the first nine months which, in combination with a preferred stock offering in the first quarter, allowed us to reduce net debt by $34.0 million for the period. Another tangible indication of our strong financial performance in a difficult environment is that our borrowing base was reaffirmed in the fall of 2009 at its prior level of $160 million."
Recent Events
As previously announced on February 1, 2010 we closed the sale of substantially all of our southwest Kansas (Hugoton Field) and southeast Colorado properties to an undisclosed buyer for $247 million cash, which permitted us to fully repay our total outstanding under our bank credit agreement and retain a significant amount of cash for general corporate purposes.
In addition, in January of 2009 the company withdrew its registration statement with the SEC. Ellora plans to report fourth quarter and full year 2009 financial and operating results as soon as they are available.
ABOUT ELLORA ENERGY
Ellora Energy Inc. is an independent oil and gas exploration and production company headquartered in Boulder, Colorado. Ellora has oil and gas assets principally located in East Texas/Louisiana in the James Lime, Haynesville and Bossier shale plays.
Forward-Looking Statements
Certain statements included in this press release may be considered forward-looking, which may be characterized by words such as "plan", "expect", project", "intend", believe", and "anticipate". Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements, and therefore these statements should not be read as guarantees of future performance or results. All forward-looking statements are based on the Company's current beliefs as well as assumptions made by and information currently available to Ellora. Actual events may differ materially from current expectations, and Ellora disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
ELLORA ENERGY INC. YEAR TO DATE INCOME STATEMENTS
3/31/2009 6/30/2009 9/30/2009
--------- --------- ---------
REVENUE:
Oil and gas sales $16,926,000 $38,191,000 $60,887,000
Gas aggregation and pipeline
sales 1,745,000 3,596,000 5,342,000
Gain (loss) on sale of
equipment - (1,000) (1,000)
--- ------ ------
Total revenue 18,671,000 41,786,000 66,228,000
---------- ---------- ----------
COSTS AND EXPENSES:
Lease operating expense 6,791,000 14,172,000 19,516,000
Production taxes 883,000 1,606,000 2,504,000
Gas aggregation and pipeline
cost of sales 1,787,000 3,593,000 5,249,000
Depreciation, depletion and
amortization 13,458,000 29,644,000 40,387,000
Exploration 7,082,000 8,239,000 12,440,000
Impairment of proved properties - 88,879,000 88,879,000
General and administrative 4,644,000 9,326,000 14,009,000
--------- --------- ----------
Total costs and expenses 34,645,000 155,459,000 182,984,000
---------- ----------- -----------
OPERATING INCOME (LOSS) (15,974,000) (113,673,000) (116,756,000)
----------- ------------ ------------
OTHER INCOME AND (EXPENSE):
Realized gain (loss) on
hedging activities 4,928,000 7,217,000 15,487,000
Unrealized gain (loss) on
hedging activities 888,000 (116,000) (8,447,000)
Unrealized gain (loss) on
embedded derivative - (1,801,000) (3,602,000)
Interest income and other - 2,000 2,000
Interest expense (1,689,000) (3,076,000) (4,429,000)
---------- ---------- ----------
TOTAL OTHER INCOME AND (EXPENSE) 4,127,000 2,226,000 (989,000)
--------- --------- --------
INCOME (LOSS) BEFORE TAXES (11,847,000) (111,447,000) (117,745,000)
----------- ------------ ------------
DEFERRED INCOME TAX (BENEFIT) (4,412,000) (41,514,000) (43,860,000)
---------- ----------- -----------
NET INCOME (LOSS) $(7,435,000) $(69,933,000) $(73,885,000)
=========== ============ ============
RECONCILIATION OF NET INCOME (LOSS)
TO EBITDAX AND EBITDA
Net income (loss) $(7,435,000) $(69,933,000) $(73,885,000)
Unrealized (gain) loss on
hedging activities (888,000) 116,000 8,447,000
Unrealized (gain) loss on
embedded derivative - 1,801,000 3,602,000
Income tax expense (benefit) (4,412,000) (41,514,000) (43,860,000)
Interest expense 1,689,000 3,076,000 4,429,000
Depreciation, depletion and
amortization 13,458,000 29,644,000 40,387,000
Exploration 7,082,000 8,239,000 12,440,000
Impairment of proved properties - 88,879,000 88,879,000
Non cash compensation expense 585,000 1,170,000 2,060,000
------- --------- ---------
EBITDAX $10,079,000 $21,478,000 $42,499,000
=========== =========== ===========
Less: exploration (7,082,000) (8,239,000) (12,440,000)
EBITDA $2,997,000 $13,239,000 $30,059,000
========== =========== ===========
ELLORA ENERGY INC. YEAR TO DATE INCOME STATEMENTS
3/31/2008 6/30/2008 9/30/2008
--------- --------- ---------
REVENUE:
Oil and gas sales $25,853,000 $61,926,000 $99,305,000
Gas aggregation and pipeline
sales 3,655,000 9,220,000 13,648,000
Gain (loss) on sale of
equipment - 91,000 91,000
--- ------ ------
Total revenue 29,508,000 71,237,000 113,044,000
---------- ---------- -----------
COSTS AND EXPENSES:
Lease operating expense 4,671,000 9,653,000 15,890,000
Production taxes 1,168,000 2,687,000 4,323,000
Gas aggregation and pipeline
cost of sales 3,266,000 7,827,000 11,701,000
Depreciation, depletion and
amortization 7,306,000 15,525,000 25,514,000
Exploration 2,493,000 4,423,000 7,962,000
General and administrative 6,081,000 11,633,000 16,766,000
--------- ---------- ----------
Total costs and expenses 24,985,000 51,748,000 82,156,000
---------- ---------- ----------
OPERATING INCOME 4,523,000 19,489,000 30,888,000
--------- ---------- ----------
OTHER INCOME AND (EXPENSE):
Realized gain (loss) on
hedging activities (995,000) (6,447,000) (10,034,000)
Unrealized gain (loss) on
hedging activities (8,559,000) (35,677,000) 9,911,000
Interest income and other 18,000 22,000 23,000
Interest expense (1,814,000) (3,446,000) (5,675,000)
---------- ---------- ----------
TOTAL OTHER INCOME AND (EXPENSE) (11,350,000) (45,548,000) (5,775,000)
----------- ----------- ----------
INCOME (LOSS) BEFORE TAXES (6,827,000) (26,059,000) 25,113,000
---------- ----------- ----------
DEFERRED INCOME TAX (BENEFIT) (2,628,000) (10,033,000) 9,668,000
---------- ----------- ---------
NET INCOME (LOSS) $(4,199,000) $(16,026,000) $15,445,000
=========== ============ ===========
RECONCILIATION OF NET INCOME (LOSS)
TO EBITDAX AND EBITDA
Net income (loss) $(4,199,000) $(16,026,000) $15,445,000
Unrealized (gain) loss on
hedging activities 8,559,000 35,677,000 (9,911,000)
Income tax expense (benefit) (2,628,000) (10,033,000) 9,668,000
Interest expense 1,814,000 3,446,000 5,675,000
Depreciation, depletion and
amortization 7,306,000 15,525,000 25,514,000
Exploration 2,493,000 4,423,000 7,962,000
Non cash compensation expense 691,000 1,475,000 2,121,000
------- --------- ---------
EBITDAX $14,036,000 $34,487,000 $56,474,000
=========== =========== ===========
Less: exploration (2,493,000) (4,423,000) (7,962,000)
EBITDA $11,543,000 $30,064,000 $48,512,000
=========== =========== ===========
ELLORA ENERGY INC. QUARTERLY INCOME STATEMENTS
3/31/2009 6/30/2009 9/30/2009
--------- --------- ---------
REVENUE:
Oil and gas sales $16,926,000 $21,265,000 $22,696,000
Gas aggregation and pipeline
sales 1,745,000 1,851,000 1,746,000
Gain on sale of equipment - (1,000) -
--- ------ ---
Total revenue 18,671,000 23,115,000 24,442,000
---------- ---------- ----------
COSTS AND EXPENSES:
Lease operating expense 6,791,000 7,381,000 5,344,000
Production taxes 883,000 723,000 898,000
Gas aggregation and pipeline
cost of sales 1,787,000 1,806,000 1,656,000
Depreciation, depletion and
amortization 13,458,000 16,186,000 10,743,000
Exploration 7,082,000 1,157,000 4,201,000
Impairment of proved
properties - 88,879,000 -
General and administrative 4,644,000 4,682,000 4,683,000
--------- --------- ---------
Total costs and expenses 34,645,000 120,814,000 27,525,000
---------- ----------- ----------
OPERATING INCOME (LOSS) (15,974,000) (97,699,000) (3,083,000)
----------- ----------- ----------
OTHER INCOME AND (EXPENSE):
Realized gain (loss) on
hedging activities 4,928,000 2,289,000 8,270,000
Unrealized gain (loss) on
hedging activities 888,000 (1,004,000) (8,331,000)
Unrealized gain (loss) on
embedded derivative - (1,801,000) (1,801,000)
Interest income and other - 2,000 -
Interest expense (1,689,000) (1,387,000) (1,353,000)
---------- ---------- ----------
TOTAL OTHER INCOME AND (EXPENSE) 4,127,000 (1,901,000) (3,215,000)
--------- ---------- ----------
INCOME (LOSS) BEFORE TAXES (11,847,000) (99,600,000) (6,298,000)
----------- ----------- ----------
DEFERRED INCOME TAX (BENEFIT) (4,412,000) (37,102,000) (2,346,000)
---------- ----------- ----------
NET INCOME (LOSS) $(7,435,000) $(62,498,000) $(3,952,000)
=========== ============ ===========
RECONCILIATION OF NET INCOME (LOSS)
TO EBITDAX AND EBITDA
Net income (loss) $(7,435,000) $(62,498,000) $(3,952,000)
Unrealized (gain) loss on
hedging activities (888,000) 1,004,000 8,331,000
Unrealized (gain) loss on
embedded derivative - 1,801,000 1,801,000
Income tax expense (benefit) (4,412,000) (37,102,000) (2,346,000)
Interest expense 1,689,000 1,387,000 1,353,000
Depreciation, depletion and
amortization 13,458,000 16,186,000 10,743,000
Exploration 7,082,000 1,157,000 4,201,000
Impairment of proved properties - 88,879,000 -
Non cash compensation expense 585,000 585,000 890,000
------- ------- -------
EBITDAX $10,079,000 $11,399,000 $21,021,000
=========== =========== ===========
Less: exploration (7,082,000) (1,157,000) (4,201,000)
EBITDA $2,997,000 $10,242,000 $16,820,000
========== =========== ===========
ELLORA ENERGY INC. QUARTERLY INCOME STATEMENTS
3/31/2008 6/30/2008 9/30/2008
--------- --------- ---------
REVENUE:
Oil and gas sales $25,853,000 $36,073,000 $37,379,000
Gas aggregation and pipeline
sales 3,655,000 5,565,000 4,428,000
Gain on sale of equipment - 91,000 -
--- ------ ---
Total revenue 29,508,000 41,729,000 41,807,000
---------- ---------- ----------
COSTS AND EXPENSES:
Lease operating expense 4,671,000 4,982,000 6,237,000
Production taxes 1,168,000 1,519,000 1,636,000
Gas aggregation and pipeline
cost of sales 3,266,000 4,561,000 3,874,000
Depreciation, depletion and
amortization 7,306,000 8,219,000 9,989,000
Exploration 2,493,000 1,930,000 3,539,000
General and administrative 6,081,000 5,552,000 5,133,000
--------- --------- ---------
Total costs and expenses 24,985,000 26,763,000 30,408,000
---------- ---------- ----------
OPERATING INCOME 4,523,000 14,966,000 11,399,000
--------- ---------- ----------
OTHER INCOME AND (EXPENSE):
Realized gain (loss) on
hedging activities (995,000) (5,452,000) (3,587,000)
Unrealized gain (loss) on
hedging activities (8,559,000) (27,118,000) 45,588,000
Interest income and other 18,000 4,000 1,000
Interest expense (1,814,000) (1,632,000) (2,229,000)
---------- ---------- ----------
TOTAL OTHER INCOME AND (EXPENSE) (11,350,000) (34,198,000) 39,773,000
----------- ----------- ----------
INCOME (LOSS) BEFORE TAXES (6,827,000) (19,232,000) 51,172,000
---------- ----------- ----------
DEFERRED INCOME TAX (BENEFIT) (2,628,000) (7,405,000) 19,701,000
---------- ---------- ----------
NET INCOME (LOSS) $(4,199,000) $(11,827,000) $31,471,000
=========== ============ ===========
RECONCILIATION OF NET INCOME (LOSS)
TO EBITDAX AND EBITDA
Net income (loss) $(4,199,000) $(11,827,000) $31,471,000
Unrealized (gain) loss on
hedging activities 8,559,000 27,118,000 (45,588,000)
Income tax expense (benefit) (2,628,000) (7,405,000) 19,701,000
Interest expense 1,814,000 1,632,000 2,229,000
Depreciation, depletion and
amortization 7,306,000 8,219,000 9,989,000
Exploration 2,493,000 1,930,000 3,539,000
Non cash compensation expense 691,000 784,000 646,000
------- ------- -------
EBITDAX $14,036,000 $20,451,000 $21,987,000
=========== =========== ===========
Less: exploration (2,493,000) (1,930,000) (3,539,000)
EBITDA $11,543,000 $18,521,000 $18,448,000
=========== =========== ===========
ELLORA ENERGY INC. AND SUBSIDIARIES
ASSETS 12/31/2008 3/31/2009 06/30/2009 9/30/2009
---------- --------- ---------- ---------
Current Assets:
Cash $10,078,000 $7,343,000 $12,727,000 $22,558,000
Accounts
receivable:
Oil and gas
sales 10,002,000 6,756,000 9,978,000 8,388,000
Joint interest
billings 1,250,000 590,000 2,514,000 855,000
Derivative asset 15,344,000 16,232,000 15,412,000 7,637,000
Oil and gas
equipment
inventory 3,616,000 3,500,000 1,714,000 1,262,000
Prepaids and other
current assets 3,414,000 3,404,000 3,426,000 4,200,000
--------- --------- --------- ---------
Total
current
assets 43,704,000 37,825,000 45,771,000 44,900,000
Property and
Equipment:
Oil and gas
properties,
successful
efforts method:
Proved
properties 390,843,000 396,562,000 399,370,000 403,297,000
Unproved
properties 65,675,000 67,504,000 67,576,000 67,363,000
Pipeline
properties 20,087,000 20,160,000 20,143,000 20,143,000
Furniture and
equipment 6,334,000 6,369,000 6,460,000 6,447,000
--------- --------- --------- ---------
Total
property
and
equipment 482,939,000 490,595,000 493,549,000 497,250,000
Less accumulated
depletion and
depreciation (84,900,000) (98,218,000) (203,193,000) (213,846,000)
----------- ----------- ------------ ------------
Net property
and
equipment 398,039,000 392,377,000 290,356,000 283,404,000
Deferred Tax Asset - - 12,358,000 11,076,000
Other Long-Term
Assets 3,312,000 3,069,000 2,852,000 3,012,000
--------- --------- --------- ---------
Total Assets $445,055,000 $433,271,000 $351,337,000 $342,392,000
============ ============ ============ ============
LIABILITIES
AND
STOCKHOLDERS'
EQUITY
Current
Liabilities:
Accounts
payable $18,948,000 $12,170,000 $14,083,000 $13,252,000
Long-term debt--
current portion 14,750,000 - - -
Accrued expenses 636,000 321,000 317,000 280,000
Production taxes
payable 418,000 430,000 411,000 389,000
Oil and gas
revenues
payable 11,254,000 11,488,000 11,843,000 10,345,000
Deferred income
taxes 5,716,000 6,047,000 5,741,000 2,845,000
Derivative
liability - - 184,000 740,000
--- --- ------- -------
Total current
liabilities 51,722,000 30,456,000 32,579,000 27,851,000
Long-Term Debt 160,000,000 141,000,000 143,750,000 140,750,000
Deferred Income
Taxes 29,112,000 24,369,000 - -
Asset Retirement
Obligations 4,026,000 4,135,000 4,276,000 4,372,000
Embedded
Derivative for
Preferred Stock
Conversion Feature - 6,996,000 8,797,000 10,598,000
Stockholders'
Equity:
Preferred
stock, $.001
par value,
10,000,000
shares
authorized - 1,000 1,000 1,000
Common stock,
$.001 par value,
125,000,000
shares authorized 45,000 45,000 46,000 46,000
Additional
paid-in
capital 149,417,000 182,971,000 181,088,000 181,926,000
Retained
earnings 50,733,000 43,298,000 (19,200,000) (23,152,000)
---------- ---------- ----------- -----------
Total
stockholders'
equity 200,195,000 226,315,000 161,935,000 158,821,000
----------- ----------- ----------- -----------
Total
Liabilities
and
Stockholders'
Equity $445,055,000 $433,271,000 $351,337,000 $342,392,000
============ ============ ============ ============
ELLORA ENERGY INC. YEAR TO DATE CASH FLOW STATEMENTS
3/31/2009 6/30/2009 9/30/2009
--------- --------- ---------
CASH FLOWS FROM OPERATING
ACTIVITIES
Net income (loss) $(7,435,000) $(69,933,000) $(73,885,000)
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion and
amortization 13,458,000 29,644,000 40,387,000
Amortization of debt issue
costs 253,000 507,000 762,000
Unrealized (gain) loss on
hedging activities (888,000) 116,000 8,447,000
Unrealized (gain) loss on
embedded derivative - 1,801,000 3,602,000
Deferred income tax expense
(benefit) (4,412,000) (41,514,000) (43,860,000)
Exploration 4,647,000 3,731,000 3,683,000
Impairment of proved properties - 88,879,000 88,879,000
Non-cash compensation expense 585,000 1,170,000 2,060,000
(Gain) loss on sale of equipment - 1,000 1,000
Changes in operating assets
and liabilities:
Accounts receivable 3,906,000 (1,240,000) 2,009,000
Prepaid and other current
assets (231,000) 239,000 (78,000)
Income taxes payable - - 545,000
Accounts payable and accrued
expenses (5,972,000) (4,356,000) (3,940,000)
Oil and gas revenues payable 234,000 589,000 (909,000)
------- ------- --------
Net cash provided by
operating activities 4,145,000 9,634,000 27,703,000
--------- --------- ----------
CASH FLOWS FROM INVESTING
ACTIVITIES
Proceeds from sale of equipment - - 7,000
Proceeds from sale of
proved property - - 900,000
Drilling capital expenditures (10,858,000) (12,404,000) (17,378,000)
Proceeds from farmout agreement - 2,000,000 2,800,000
Unproved property acquisition (2,061,000) (3,969,000) (4,670,000)
Pipeline capital expenditures (73,000) (56,000) (56,000)
Purchase of other property
and equipment (94,000) (196,000) (199,000)
------- -------- --------
Net cash used in investing
activities (13,086,000) (14,625,000) (18,596,000)
----------- ----------- -----------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from sale of Ellora
Energy Inc. preferred stock 39,968,000 39,761,000 39,761,000
Proceeds from long-term debt
under credit agreement 5,250,000 8,000,000 8,000,000
Principal payments of
long-term debt
under credit agreement (39,000,000) (39,000,000) (42,000,000)
Loan origination fees (10,000) (47,000) (65,000)
Purchase of Ellora Energy Inc.
common stock - (1,000,000) (1,964,000)
Restricted stock used for tax
withholdings (2,000) (74,000) (359,000)
------ ------- --------
Net cash provided by
financing activities 6,206,000 7,640,000 3,373,000
--------- --------- ---------
INCREASE (DECREASE) IN CASH (2,735,000) 2,649,000 12,480,000
Cash, beginning of period 10,078,000 10,078,000 10,078,000
---------- ---------- ----------
Cash, end of period $7,343,000 $12,727,000 $22,558,000
========== =========== ===========
ELLORA ENERGY INC. YEAR TO DATE CASH FLOW STATEMENTS
3/31/2008 6/30/2008 9/30/2008
--------- --------- ---------
CASH FLOWS FROM OPERATING
ACTIVITIES
Net income (loss) $(4,199,000) $(16,026,000) $15,445,000
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion and
amortization 7,306,000 15,525,000 25,514,000
Amortization of debt issue
costs 74,000 245,000 498,000
Unrealized (gain) loss on
hedging activities 8,559,000 35,677,000 (9,911,000)
Deferred income tax expense
(benefit) (2,628,000) (10,033,000) 9,668,000
Exploration (1,267,000) (912,000) 759,000
Non-cash compensation expense 691,000 1,475,000 2,121,000
(Gain) loss on sale of equipment - (91,000) (91,000)
Changes in operating assets
and liabilities:
Accounts receivable (916,000) (2,934,000) (1,358,000)
Prepaid and other current
assets (151,000) (1,161,000) (3,529,000)
Income taxes payable (290,000) (290,000) (290,000)
Accounts payable and accrued
expenses 2,594,000 7,851,000 7,434,000
Oil and gas revenues payable 563,000 1,844,000 1,040,000
------- --------- ---------
Net cash provided by
operating activities 10,336,000 31,170,000 47,300,000
---------- ---------- ----------
CASH FLOWS FROM INVESTING
ACTIVITIES
Proceeds from sale of
equipment - 248,000 248,000
Drilling capital expenditures (26,240,000) (51,661,000) (72,469,000)
Unproved property acquisition (1,596,000) (4,198,000) (15,103,000)
Pipeline capital expenditures (233,000) (311,000) (314,000)
Purchase of other property and
equipment (266,000) (232,000) (495,000)
-------- -------- --------
Net cash used in investing
activities (28,335,000) (56,154,000) (88,133,000)
----------- ----------- -----------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from long-term debt
under credit agreement 24,000,000 33,750,000 46,250,000
Loan origination fees - (3,157,000) (3,206,000)
Restricted stock used for tax
withholdings - - (410,000)
--- --- --------
Net cash provided by
financing activities 24,000,000 30,593,000 42,634,000
---------- ---------- ----------
INCREASE IN CASH 6,001,000 5,609,000 1,801,000
Cash, beginning of period 4,651,000 4,651,000 4,651,000
--------- --------- ---------
Cash, end of period $10,652,000 $10,260,000 $6,452,000
=========== =========== ==========
ELLORA ENERGY INC. QUARTERLY CASH FLOW STATEMENTS
3/31/2009 6/30/2009 9/30/2009
--------- --------- ---------
CASH FLOWS FROM OPERATING
ACTIVITIES
Net income (loss) $(7,435,000) $(62,498,000) $(3,952,000)
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion and
amortization 13,458,000 16,186,000 10,743,000
Amortization of debt issue
costs 253,000 254,000 255,000
Unrealized (gain) loss on
hedging activities (888,000) 1,004,000 8,331,000
Unrealized (gain) loss on
embedded derivative - 1,801,000 1,801,000
Deferred income tax expense
(benefit) (4,412,000) (37,102,000) (2,346,000)
Exploration 4,647,000 (916,000) (48,000)
Impairment of proved
properties - 88,879,000 -
Non-cash compensation expense 585,000 585,000 890,000
(Gain) loss on sale of equipment - 1,000 -
Changes in operating assets
and liabilities:
Accounts receivable 3,906,000 (5,146,000) 3,249,000
Prepaid and other current
assets (231,000) 470,000 (317,000)
Income taxes payable - - 545,000
Accounts payable and accrued
expenses (5,972,000) 1,616,000 416,000
Oil and gas revenues payable 234,000 355,000 (1,498,000)
------- ------- ----------
Net cash provided by
operating activities 4,145,000 5,489,000 18,069,000
--------- --------- ----------
CASH FLOWS FROM INVESTING
ACTIVITIES
Proceeds from sale of equipment - - 7,000
Proceeds from sale of proved
property - - 900,000
Drilling capital expenditures (10,858,000) (1,546,000) (4,974,000)
Proceeds from farmout agreement - 2,000,000 800,000
Unproved property acquisition (2,061,000) (1,908,000) (701,000)
Pipeline capital expenditures (73,000) 17,000 -
Purchase of other property
and equipment (94,000) (102,000) (3,000)
------- -------- ------
Net cash used in investing
activities (13,086,000) (1,539,000) (3,971,000)
----------- ---------- ----------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from sale of Ellora
Energy Inc. preferred stock 39,968,000 (207,000) -
Proceeds from long-term debt
under credit agreement 5,250,000 2,750,000 -
Principal payments of
long-term debt
under credit agreement (39,000,000) - (3,000,000)
Loan origination fees (10,000) (37,000) (18,000)
Purchase of Ellora Energy Inc.
common stock - (1,000,000) (964,000)
Restricted stock used for tax
withholdings (2,000) (72,000) (285,000)
------ ------- --------
Net cash provided by
financing activities 6,206,000 1,434,000 (4,267,000)
--------- --------- ----------
INCREASE (DECREASE) IN CASH (2,735,000) 5,384,000 9,831,000
Cash, beginning of month 10,078,000 7,343,000 12,727,000
---------- --------- ----------
Cash, end of period $7,343,000 $12,727,000 $22,558,000
========== =========== ===========
ELLORA ENERGY INC. QUARTERLY CASH FLOW STATEMENTS
3/31/2008 6/30/2008 9/30/2008
--------- --------- ---------
CASH FLOWS FROM OPERATING
ACTIVITIES
Net income (loss) $(4,199,000) $(11,827,000) $31,471,000
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion and
amortization 7,306,000 8,219,000 9,989,000
Amortization of debt issue
costs 74,000 171,000 253,000
Unrealized (gain) loss on
hedging activities 8,559,000 27,118,000 (45,588,000)
Deferred income tax expense
(benefit) (2,628,000) (7,405,000) 19,701,000
Exploration (1,267,000) 355,000 1,671,000
Non-cash compensation expense 691,000 784,000 646,000
(Gain) loss on sale of equipment - (91,000) -
Changes in operating assets
and liabilities:
Accounts receivable (916,000) (2,018,000) 1,576,000
Prepaid and other current
assets (151,000) (1,010,000) (2,368,000)
Income taxes payable (290,000) - -
Accounts payable and accrued
expenses 2,594,000 5,257,000 (417,000)
Oil and gas revenues payable 563,000 1,281,000 (804,000)
------- --------- --------
Net cash provided by
operating activities 10,336,000 20,834,000 16,130,000
---------- ---------- ----------
CASH FLOWS FROM INVESTING
ACTIVITIES
Proceeds from sale of equipment - 248,000 -
Drilling capital expenditures (26,240,000) (25,421,000) (20,808,000)
Unproved property acquisition (1,596,000) (2,602,000) (10,905,000)
Pipeline capital expenditures (233,000) (78,000) (3,000)
Purchase of other property
and equipment (266,000) 34,000 (263,000)
-------- ------ --------
Net cash used in investing
activities (28,335,000) (27,819,000) (31,979,000)
----------- ----------- -----------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from long-term debt
under credit agreement 24,000,000 9,750,000 12,500,000
Loan origination fees - (3,157,000) (49,000)
Restricted stock used for tax
withholdings - - (410,000)
--- --- --------
Net cash provided by
financing activities 24,000,000 6,593,000 12,041,000
---------- --------- ----------
INCREASE (DECREASE) IN CASH 6,001,000 (392,000) (3,808,000)
Cash, beginning of month 4,651,000 10,652,000 10,260,000
--------- ---------- ----------
Cash, end of period $10,652,000 $10,260,000 $6,452,000
=========== =========== ==========
ELLORA ENERGY INC. YEAR TO DATE OPERATING METRICS
3/31/2009 6/30/2009 9/30/2009
--------- --------- ---------
Oil production - Bbl 229,000 477,000 708,000
Gas production - Mcf 2,697,000 5,454,000 8,150,000
--------- --------- ---------
Mcfe 4,071,000 8,316,000 12,398,000
Oil sales $7,581,000 $20,609,000 $34,751,000
Gas sales $9,345,000 $17,582,000 $26,136,000
---------- ----------- -----------
$16,926,000 $38,191,000 $60,887,000
Realized price per Bbl - unhedged $33.10 $43.21 $49.08
Realized price per Mcf - unhedged $3.46 $3.22 $3.21
Realized price per Mcfe - unhedged $4.16 $4.59 $4.91
Realized price per Mcfe - hedged $5.37 $5.46 $6.16
Oil production (Bbl/d) 2,544 2,635 2,593
Gas production (Mcf/d) 29,967 30,133 29,853
Total equivalent production
(Mcfe/d) 45,233 45,945 45,414
Unit metrics ($/Mcfe)
Total revenue $4.59 $5.02 $5.34
Lease operating expense $1.67 $1.70 $1.57
Production taxes $0.22 $0.19 $0.20
Depreciation, depletion and
amortization $3.31 $3.56 $3.26
Exploration and other $1.74 $0.99 $1.00
General and administrative - Cash $1.00 $0.98 $0.96
General and administrative - Non
Cash $0.14 $0.14 $0.17
EBITDA $0.74 $1.59 $2.42
EBITDAX $2.48 $2.58 $3.43
Net Income (loss) $(1.83) $(8.41) $(5.96)
Cash flow from operations $1.02 $1.16 $2.23
ELLORA ENERGY INC. YEAR TO DATE OPERATING METRICS
3/31/2008 6/30/2008 9/30/2008
--------- --------- ---------
Oil production - Bbl 87,000 186,000 358,000
Gas production - Mcf 2,308,000 4,678,000 7,026,000
--------- --------- ---------
Mcfe 2,830,000 5,794,000 9,174,000
Oil sales $7,983,000 $19,939,000 $38,089,000
Gas sales $17,870,000 $41,987,000 $61,216,000
----------- ----------- -----------
$25,853,000 $61,926,000 $99,305,000
Realized price per Bbl - unhedged $91.76 $107.20 $106.39
Realized price per Mcf - unhedged $7.74 $8.98 $8.71
Realized price per Mcfe - unhedged $9.14 $10.69 $10.82
Realized price per Mcfe - hedged $8.78 $9.58 $9.73
Oil production (Bbl/d) 956 1,022 1,307
Gas production (Mcf/d) 25,363 25,703 25,642
Total equivalent production
(Mcfe/d) 31,099 31,835 33,482
Unit metrics ($/Mcfe)
Total revenue $10.43 $12.29 $12.32
Lease operating expense $1.65 $1.67 $1.73
Production taxes $0.41 $0.46 $0.47
Depreciation, depletion and
amortization $2.58 $2.68 $2.78
Exploration and other $0.88 $0.76 $0.87
General and administrative - Cash $1.90 $1.75 $1.60
General and administrative - Non
Cash $0.24 $0.25 $0.23
EBITDA $4.08 $5.19 $5.29
EBITDAX $4.96 $5.95 $6.16
Net Income (loss) $(1.48) $(2.77) $1.68
Cash flow from operations $3.65 $5.38 $5.16
ELLORA ENERGY INC. QUARTERLY OPERATING METRICS
3/31/2009 6/30/2009 9/30/2009
--------- --------- ---------
Oil production - Bbl 229,000 248,000 231,000
Gas production - Mcf 2,697,000 2,757,000 2,696,000
--------- --------- ---------
Mcfe 4,071,000 4,245,000 4,082,000
Oil sales $7,581,000 $13,028,000 $14,142,000
Gas sales $9,345,000 $8,237,000 $8,554,000
---------- ---------- ----------
Oil & gas sales $16,926,000 $21,265,000 $22,696,000
Realized price per Bbl - unhedged $33.10 $52.53 $61.22
Realized price per Mcf - unhedged $3.46 $2.99 $3.17
Realized price per Mcfe - unhedged $4.16 $5.01 $5.56
Realized price per Mcfe - hedged $5.37 $5.55 $7.59
Oil production (Bbl/d) 2,544 2,725 2,511
Gas production (Mcf/d) 29,967 30,297 29,304
Total equivalent production
(Mcfe/d) 45,233 46,648 44,370
Unit metrics ($/Mcfe)
Total revenue $4.59 $5.45 $5.99
Lease operating expense $1.67 $1.74 $1.31
Production taxes $0.22 $0.17 $0.22
Depreciation, depletion and
amortization $3.31 $3.81 $2.63
Exploration and other $1.74 $0.27 $1.03
General and administrative - Cash $1.00 $0.97 $0.93
General and administrative - Non
Cash $0.14 $0.14 $0.22
EBITDA $0.74 $2.41 $4.12
EBITDAX $2.48 $2.69 $5.15
Net Income (loss) $(1.83) $(14.72) $(0.97)
Cash flow from operations $1.02 $1.29 $4.43
ELLORA ENERGY INC. QUARTERLY OPERATING METRICS
3/31/2008 6/30/2008 9/30/2008
--------- --------- ---------
Oil production - Bbl 87,000 99,000 172,000
Gas production - Mcf 2,308,000 2,370,000 2,348,000
--------- --------- ---------
Mcfe 2,830,000 2,964,000 3,380,000
Oil sales $7,983,000 $11,956,000 $18,150,000
Gas sales $17,870,000 $24,117,000 $19,229,000
----------- ----------- -----------
Oil & gas sales $25,853,000 $36,073,000 $37,379,000
Realized price per Bbl - unhedged $91.76 $120.77 $105.52
Realized price per Mcf - unhedged $7.74 $10.18 $8.19
Realized price per Mcfe - unhedged $9.14 $12.17 $11.06
Realized price per Mcfe - hedged $8.78 10.33 10.00
Oil production (Bbl/d) 956 1,088 1,870
Gas production (Mcf/d) 25,363 26,044 25,522
Total equivalent production
(Mcfe/d) 31,099 32,571 36,739
Unit metrics ($/Mcfe)
Total revenue $10.43 $14.08 $12.37
Lease operating expense $1.65 $1.68 $1.85
Production taxes $0.41 $0.51 $0.48
Depreciation, depletion and
amortization $2.58 $2.77 $2.96
Exploration and other $0.88 $0.65 $1.05
General and administrative - Cash $1.90 $1.61 $1.33
General and administrative - Non
Cash $0.24 $0.26 $0.19
EBITDA $4.08 $6.25 $5.46
EBITDAX $4.96 $6.90 $6.51
Net Income (loss) $(1.48) $(3.99) $9.31
Cash flow from operations $3.65 $7.03 $4.77
SOURCE Ellora Energy Inc.
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