HOUSTON, May 6 /PRNewswire-FirstCall/ -- Dune Energy, Inc.
(NYSE Amex: DNE) today announced results for the first quarter of
2010.
Revenue and Production
Revenue for the first quarter totaled $20.3 million as compared with $14.3 million for the first quarter of 2009.
Production volumes in the first quarter were 180 Mbbls of oil
and 1.17 Bcf of natural gas, or 2.3 Bcfe. This compares with
198 Mbbls of oil and 1.18 Bcf of natural gas, or 2.4 Bcfe for the
first quarter of 2009. In the first quarter of 2010, the
average sales price per barrel of oil was $76.24, and $5.57
per mcf for natural gas, as compared with $39.86 per barrel and $5.43 per mcf, respectively, for the first
quarter of 2009. The primary reasons behind the increase in
revenue were higher average sales prices in the first quarter of
2010 versus the first quarter of 2009.
Costs and Expenses
Total lease operating expense for the first quarter totaled
$8.5 million versus $7.0 million for the first quarter of 2009.
Approximately $347,000 of this
increase was associated with a prior year adjustment, $400,000 was associated with increased salt water
disposal costs in one field and $300,000 was associated with increased production
and resultant expenses at our Chocolate Bayou Field. Cash
G&A expense totaled $2.6 million
for the first quarter of 2009 versus $3.4
million for the first quarter of 2008. The
$0.8 million decrease reflects a
continued focus on cost controls. Interest financing expense
was $8.9 million for the first
quarter of 2010 versus the $8.7
million of 2009, primarily associated with payment of 10.5%
interest on the $300 million of
Senior Secured Notes. We incurred a gain of $1.3 million on hedging during the first quarter
of 2010 versus a $2.8 million gain in
the first quarter of 2009.
Earnings
Net loss totaled $7.9 million for
the first quarter of 2010, and $12.1
million for the first quarter of 2009. Preferred stock
dividends were $6.4 million in the
first quarter of 2009 versus $8.9
million in the first quarter of 2008. Net loss per
share, both basic and fully diluted, for the quarter was
$0.36, based on 40.2 million weighted
average shares outstanding as compared with a loss of $1.03 per share in the first quarter of 2009 with
20.2 million weighted average shares outstanding. The
increased outstanding common shares are associated with the
conversion of Preferred shares into common shares and reflect a 1
for 5 reverse split completed in December of 2009.
Liquidity
As previously announced, we amended our revolver with Wells
Fargo Foothill on March 23, 2010
extending the maturity to March 31,
2011. Current availability under the revolver is
$40 million subject to several
covenants regarding EBITDA, production, capital and payables.
At the end of the quarter $24
million was drawn on the revolver and $8.5 million of letters of credit were
outstanding. Cash at the end of the quarter was $20.1 million resulting in liquidity of
$27.6 million.
James A. Watt, President and
Chief Executive Officer stated, "Our recent release detailed the
potential of the Chocolate Bayou field and our Garden Island Bay
deep subsalt prospect. With deals coming together for these
prospects, there is visibility for the upside potential of our
asset base. In order to manage liquidity we will seek
industry partners on a promoted basis to participate in high
potential drilling opportunities and may monetize certain non-core
assets. The resultant improved liquidity along with the
expiration of the make whole on the Preferred shares should allow
value to accrue to all stake holders assuming success in our
drilling programs."
Click here for more information:
http://www.duneenergy.com/news.html?b=1683&1=1
FORWARD-LOOKING STATEMENTS: This document includes
forward-looking statements that are intended to be covered by
"forward-looking statements" safe harbor provided by the Private
Securities Litigation Reform Act of 1995. All statements
included in this press release that address activities, events or
developments that Dune Energy expects, believes or anticipates will
or may occur in the future are forward-looking statements.
Forward-looking statements include, but are not limited to,
statements concerning estimates of expected drilling and
development wells and associated costs, statements relating to
estimates of, and increases in, production, cash flows and values,
statements relating to the continued advancement of Dune Energy,
Inc.'s projects and other statements that are not historical facts.
When used in this document, the words such as "could," "plan,"
"estimate," "expect," "intend," "may," "potential," "should," and
similar expressions are forward-looking statements. Although Dune
Energy, Inc. believes that its expectations reflected in these
forward-looking statements are reasonable, such statements involve
risks and uncertainties and no assurance can be given that actual
results will be consistent with these forward-looking statements.
Important factors that could cause actual results to differ from
these forward-looking statements include the potential that the
Company's projects will experience technological and mechanical
problems, geological conditions in the reservoir may not result in
commercial levels of oil and gas production, changes in product
prices and other risks disclosed in Dune's Annual report on Form
10-K filed with the U.S. Securities and Exchange Commission.
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Dune
Energy, Inc.
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Consolidated Balance Sheets
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(Unaudited)
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March
31, 2010
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December 31, 2009
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ASSETS
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Current assets:
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Cash
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$
20,148,044
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$
15,053,571
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Accounts
receivable
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13,505,263
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15,026,945
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Prepayments and
other current assets
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2,044,603
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2,724,666
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Total current assets
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35,697,910
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32,805,182
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Oil and gas properties, using
successful efforts accounting - proved
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595,159,979
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593,661,488
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Less accumulated depreciation,
depletion, amortization and impairment
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(268,458,491)
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(260,548,612)
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Net oil and gas
properties
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326,701,488
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333,112,876
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Property and equipment, net of
accumulated depreciation
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of $2,443,090 and
$2,247,220
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1,041,759
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1,215,123
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Deferred financing costs, net of
accumulated amortization
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of $1,714,083 and
$1,565,280
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1,377,642
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1,026,445
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Other assets
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4,322,227
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4,427,826
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6,741,628
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6,669,394
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TOTAL ASSETS
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$
369,141,026
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$
372,587,452
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LIABILITIES AND STOCKHOLDERS'
DEFICIT
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Current liabilities:
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Accounts
payable
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$
7,424,872
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$
11,760,370
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Accrued
liabilities
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30,777,504
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21,656,922
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Derivative
liability
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37,304
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1,596,545
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Short-term
debt
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24,902,462
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1,579,308
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Preferred stock
dividend payable
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2,019,000
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1,985,000
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Total current
liabilities
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65,161,142
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38,578,145
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Long-term debt, net of discount
of $7,023,702 and $7,737,553
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292,976,298
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316,262,447
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Other long-term
liabilities
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18,439,356
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18,051,230
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Total liabilities
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376,576,796
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372,891,822
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Commitments and
contingencies
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-
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-
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Redeemable convertible preferred
stock, net of discount of $6,676,443 and $7,205,812, liquidation
preference of $1,000 per share, 750,000 shares designated, 195,364
and 192,050 shares issued and outstanding
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188,687,557
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184,844,188
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STOCKHOLDERS' DEFICIT
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Preferred stock, $.001 par
value, 1,000,000 shares authorized, 250,000 shares
undesignated, no shares issued and outstanding
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-
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-
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Common stock, $.001 par value,
300,000,000 shares authorized, 40,484,243 and 39,801,796
shares issued and outstanding
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40,484
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39,802
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Treasury stock, at cost (68,720
and 68,089 shares)
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(48,749)
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(48,642)
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Additional paid-in
capital
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94,543,557
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97,600,721
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Accumulated deficit
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(290,658,619)
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(282,740,439)
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Total stockholders'
deficit
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(196,123,327)
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(185,148,558)
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TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIT
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$
369,141,026
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$
372,587,452
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Dune
Energy, Inc.
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Consolidated Statements of Operations
and Comprehensive Loss
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(Unaudited)
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Three
months ended March 31,
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2010
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2009
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Revenues
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$
20,251,197
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$
14,298,648
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Operating expenses:
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Lease operating
expense and production taxes
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8,533,882
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7,019,723
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Accretion of asset
retirement obligation
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471,522
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410,874
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Depletion,
depreciation and amortization
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8,105,749
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8,055,727
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General and
administrative expense
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3,445,956
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5,047,580
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Total operating
expense
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20,557,109
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20,533,904
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Operating loss
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(305,912)
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(6,235,256)
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Other
income(expense):
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Interest
income
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491
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30,327
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Interest
expense
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(8,871,633)
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(8,678,947)
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Gain on derivative
liabilities
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1,258,874
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2,803,000
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Total other
income(expense)
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(7,612,268)
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(5,845,620)
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Net loss
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(7,918,180)
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(12,080,876)
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Preferred stock
dividend
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(6,403,108)
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(8,855,060)
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Net loss available to common
shareholders
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$
(14,321,288)
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$
(20,935,936)
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Net loss per share:
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Basic and
diluted
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$
(0.36)
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$
(1.03)
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Weighted average shares
outstanding:
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Basic and
diluted
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40,197,415
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20,246,792
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Comprehensive loss:
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Net loss
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(7,918,180)
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(12,080,876)
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Other comprehensive
income
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-
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924,218
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Comprehensive
loss
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(7,918,180)
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(11,156,658)
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Dune
Energy, Inc.
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Consolidated Statements of Cash
Flows
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(Unaudited)
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|
|
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Three
months ended March 31,
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2010
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2009
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CASH FLOWS FROM OPERATING
ACTIVITIES
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Net loss
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$
(7,918,180)
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$
(12,080,876)
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Adjustments to reconcile net
loss to net cash used in operating activities:
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Depletion,
depreciation and amortization
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8,105,749
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8,055,727
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Amortization of
deferred financing costs and debt discount
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862,654
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783,908
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Stock-based
compensation
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820,889
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1,639,001
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Accretion of asset
retirement obligation
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471,522
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410,874
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Gain on derivative
liabilities
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(1,559,241)
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(361,442)
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Changes
in:
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Accounts
receivable
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1,521,574
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2,598,773
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Prepayments
and other assets
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680,063
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675,239
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Payments
made to settle asset retirement obligations
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(70,933)
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(129,062)
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Accounts
payable and accrued liabilities
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4,772,620
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(2,929,215)
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NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES
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7,686,717
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(1,337,073)
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CASH FLOWS FROM INVESTING
ACTIVITIES
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Investment in proved and
unproved properties
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(1,498,491)
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(3,016,375)
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Purchase of furniture and
fixtures
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-
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(7,858)
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Decrease (increase) in other
assets
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83,093
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(649,277)
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NET CASH USED IN INVESTING
ACTIVITIES
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(1,415,398)
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(3,673,510)
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CASH FLOWS FROM FINANCING
ACTIVITIES
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|
|
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Payment on debt issuance
cost
|
|
(500,000)
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-
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|
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Payments on short-term debt
|
|
(676,846)
|
|
(863,007)
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NET CASH USED IN FINANCING
ACTIVITIES
|
|
(1,176,846)
|
|
(863,007)
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|
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NET CHANGE IN CASH
BALANCE
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|
5,094,473
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(5,873,590)
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Cash balance at
beginning of period
|
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15,053,571
|
|
15,491,532
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Cash balance at end
of period
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$
20,148,044
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$
9,617,942
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SUPPLEMENTAL
DISCLOSURES
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Interest paid
|
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$
136,110
|
|
$
20,039
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|
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Income taxes paid
|
|
-
|
|
-
|
|
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NON-CASH DISCLOSURES
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Redeemable convertible preferred
stock dividends
|
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$
5,873,739
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|
$
8,382,237
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Accretion of discount on
preferred stock
|
|
529,369
|
|
472,823
|
|
|
Common stock issued for
conversion of preferred stock
|
|
2,448,000
|
|
8,027,000
|
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SOURCE Dune Energy, Inc.