EX-99.1 2 newconcept8kex991081908.txt PRESS RELEASE NEW CONCEPT ENERGY Exhibit 99.1 For Immediate Release Contact: Oscar Smith Gene Bertcher (972) 407-8400 NEW CONCEPT ENERGY REPORTS SECOND QUARTER 2008 RESULTS Dallas, Texas (Business Wire) August 15, 2008: New Concept Energy, Inc. (AMEX: GBR), ("the Company" or "NCE"), a Dallas-based company investing in and developing oil and gas leases, today reported net income of $14.9 million or $7.73 per share and $15 million or $7.84 per share for the three and six months ended June 30, 2008, compared to net losses of $6,000 or $0.01 per share and $433,000 or $0.44 per share for the same periods in 2007. In November 2007, a wholly owned subsidiary of NCE acquired 1,712 net acres of mineral leasehold interests in four separate sections of land in the Fayetteville Shale area of Arkansas from a related party. The acquisition price was $4,000 per net acre. The subsidiary also acquired two separate options to acquire additional leasehold interests of 1,815 net acres and 583 net acres in the same county in Arkansas at the same price of $4,000 per net acre. At the time of the acquisition it was the Company's intention, subject to the availability of funds, to develop and drill gas wells on the acreage however an opportunity developed where the Company could sell the mineral rights to an independent third party for cash. On May 9, 2008 the company exercised its options to acquire the additional 2,398 acres and completed a sale of all its 4,112 acres of mineral rights. The company received cash and recorded income before taxes of $16,440,000. The Company is now attempting to acquire other oil and gas interests. For the three and six months ended June 30, 2008, the Company recorded revenues of $699,000 and $1.4 million from a real estate property compared to $761,000 and $1.5 million for the same periods in 2007. For the three and six months ended June 30, 2008, operating expenses and lease expense at the retirement property were $550,000 and $1.1 million as compared to $543,000 and $1.1 million for the same periods in 2007. For the three and six months ended June 30, 2008, corporate general & administrative expenses were $264,000 and $525,000 as compared to $251,000 and $474,000 for the same periods in 2007. For the three and six months ended June 30, 2008, interest income was $198,000 and $250,000 as compared to $27,000 and $111,000 for the same periods in 2007. The increases are due to the Company's increased investment in interest bearing notes. The Company recorded interest expense for the three and six months ended June 30, 2008, of $68,000 and $230,000 as compared to no interest expense for the same periods in 2007. A wholly owned subsidiary of the Company purchased leasehold interests in November 2007 in approximately 1,712 acres of land in the Fayetteville Shale area of Arkansas in exchange for a $6.8 million note with interest at 9.5% per annum. Other income was $148,000 and $412,000 for the three and six months ended June 30, 2008, as compared to no other income and $10,000 for the same periods in 2007. The increase in the period ended March 31, 2008 was principally due to the collection of back interest from a mortgage bond receivable due to the sale of a property in August 2001. Because the mortgage bond was payable based on cash flow and profit of the property, the uncollected interest was not recorded until collected. The increase during the three months ended June 30, 2008 was principally due to the collection of a note that was previously written off. Certain statements in this media release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. The words "estimate", "plan", "intend", "expect", "anticipate", "believe" and similar expressions are intended to identify forward-looking statements. These forward-looking statements are found at various places throughout this release. New Concept Energy, Inc. disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Although we believe that our expectations are based upon reasonable assumptions, we can give no assurance that our goals will be achieved. Important factors that could cause our actual results to differ from estimates or projects contained in any forward-looking statements are described under ITEM 1A. RISK FACTORS in the Company's Form 10-K for the fiscal year ended December 31, 2007.
New Concept Energy, Inc. Consolidated Statements of Operations (amounts in thousands, except per share data) For The Three Month For The Six Month Period Ended Period Ended June 30, June 30, 2008 2007 2008 2007 -------- -------- -------- -------- (Unaudited) (Unaudited) Revenue Real estate operations $ 699 $ 761 $ 1,403 $ 1,482 -------- -------- -------- -------- Operating expenses Real estate operations 313 324 628 630 Lease expense 237 219 473 459 Corporate general and administrative 264 251 525 474 -------- -------- -------- -------- 814 794 1,626 1,563 -------- -------- -------- -------- Operating loss (115) (33) (223) (81) Other income (expense) Interest income 198 27 250 111 Interest expense (68) -- (230) -- Gain on the sale of leasehold interests 16,440 -- 16,440 -- Other income net 138 -- 412 10 -------- -------- -------- -------- 16,708 27 16,872 121 -------- -------- -------- -------- Earnings (loss) from continuing operations 16,593 (6) 16,649 40 Provision for income taxes 1,626 -- 1,626 -- -------- -------- -------- -------- Net income (loss) from continuing operations 14,967 (6) 15,023 40 -------- -------- -------- -------- Discontinued Operations Loss from operations -- -- -- (159) Provision for asset impairment -- -- -- (314) -------- -------- -------- -------- Loss from discontinued operations -- -- (473) -------- -------- -------- -------- Net income (loss) applicable to common shares 14,967 (6) 15,023 (433) ======== ======== ======== ======== Earnings (loss) per share - basic and diluted Continuing operations $ 7.73 $ (0.01) $ 7.84 $ 0.04 Discontinued operations -- -- -- (0.48) -------- -------- -------- -------- Net income (loss) per share $ 7.73 $ (0.01) $ 7.84 $ (0.44) ======== ======== ======== ======== Basic weighted average common shares 1,937 986 1,916 986
New Concept Energy, Inc. Consolidated Balance Sheets (amounts in thousands) June 30, December 31, Assets 2008 2007 (Unaudited) ------- ------- Current assets Cash and cash equivalents $ 159 $ 172 Notes and interest receivable - related party 16,149 2,200 Other current assets 11 8 ------- ------- Total current assets 16,319 2,380 Investment in mineral rights -- 6,848 Deposit for oil & gas acquisitions 5,429 -- Property and equipment, at cost Land and improvements 20 20 Buildings and improvements 172 172 Equipment and furnishings 373 336 ------- ------- 565 528 Less accumulated depreciation 417 397 ------- ------- 148 131 Deferred tax asset -- 250 Other assets 250 177 ------- ------- Total Assets $22,146 $ 9,786 ======= ======= New Concept Energy, Inc. Consolidated Balance Sheets - Continued (amounts in thousands, except share amounts) June 30, December 31, Liabilities and Stockholders' equity 2008 2007 (Unaudited) -------- -------- Current liabilities Accounts payable - trade $ 82 $ 90 Income taxes payable 1,376 -- Accrued expenses 266 175 -------- -------- Total current liabilities 1,724 265 Long term debt - related party -- 6,921 Other long-term liabilities 428 459 -------- -------- Total liabilities 2,152 7,645 Stockholders' equity Preferred stock, Series B 1 1 Common stock $.01 par value; authorized, 100,000,000 shares; 986,943 shares at June 30, 2007 and 1,936,985 shares at June 30, 2008 issued and outstanding 19 10 Additional paid-in capital 58,814 55,992 Accumulated deficit (38,840) (53,862) -------- -------- 19,994 2,141 -------- -------- Total Liabilities and Equity $ 22,146 $ 9,786 ======== ========