UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) August 13, 2014
BREITLING ENERGY CORPORATION
(Exact name of registrant as specified in its charter)
Nevada
|
000-50541
|
88-0507007
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(State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
1910 Pacific Avenue, Suite 12000
Dallas, Texas 75201
(Address of principal executive offices, including zip code)
(214) 716-2600
(Registrant’s telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition
The following information, including the press release attached as Exhibit 99.1 is being furnished pursuant to Item 2.02 “Results of Operations and Financial Condition,” not filed, for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). This information shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
On August 13, 2014, Breitling Energy Corporation issued the press release attached as Exhibit 99.1 providing information regarding the company’s operating data.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
No. |
Exhibit | |
99.1 |
Press Release
|
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BREITLING ENERGY CORPORATION | ||||||
| August 13, 2014 | By: | /s/ Chris A. Faulkner | ||||
| Name: | Chris A. Faulkner | |||||
| Title: | President and Chief Executive Officer | |||||
SIGNATURE
PAGETO FORM 8-K
Exhibit Index
No. |
Exhibit | |
99.1
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Press Release | |
Exhibit 99.1
Breitling Energy Corporation Reports Second Quarter 2014 Financial and Operating Results
DALLAS, TEXAS, August 13, 2014 /PRNewswire/ — Breitling Energy Corporation (OTC: BECC, “Breitling”) announced today its results for the second quarter ended June 30, 2014.
Second quarter 2014 highlights include:
| – | Dual-focused growth strategy generated net income of $841,000 and revenue growth of approximately 190% over second quarter 2013 |
| – | Revenue from third-party drilling and the sale of oil and natural gas royalties nearly doubled over second quarter 2013 |
| – | Oil, natural gas and related product sales increased by more than 50% during the quarter over the same period in 2013 |
| – | Completed two wells - one in the Permian Basin and one in Southern Kansas |
| Period Ended June 30 | ||||||||
| (In thousands except per-share data) | Q2 2014 (Unaudited) | Q2 2013 (Unaudited) | ||||||
| Total revenues | $ | 16,031 | $ | 5,548 | ||||
| Operating income | $ | 944 | $ | 220 | ||||
| Net income | $ | 841 | $ | 216 | ||||
| Net income per common share | $ | 0.00 | $ | 0.00 | ||||
| Weighted average common shares outstanding | 498,884 | 461,467 | ||||||
"The momentum with which we started 2014 continued this quarter, enabling the Company to advance its dual-focused strategy of growth through the drill bit and de-risking our operated positions while generating working capital by selling down portions of those operating positions and certain royalty interests,” said Chris Faulkner, Chairman, President and Chief Executive Officer of Breitling. “Our results this quarter are a product of our strategy to fund ongoing exploration and production programs and manage our risk exposure by selectively selling down a portion of our operating interests and selling royalty interests in non-operated properties to generate working capital. We expect to duplicate this strategy for our other operating properties and any additional acreage acquired in the near future.”
“We continue to advance our drilling programs in Sterling and Taylor Counties in Texas, and our wells in those locations are beginning to produce in line with expectations,” continued Faulkner. “Additionally, our technical team continues to identify high-potential operating properties within appropriate risk parameters, which will enable our continued profitable growth through the drill bit while increasing our acreage position and production.”
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FINANCIAL RESULTS
During the three months ended June 3, 2014, Breitling reported net income of $841,000 on revenues of $16 million. These results compare with net income of $216,000 on revenue of $5.5 million for the second quarter of 2013. During the first half of 2014, Breitling also improved its working capital by $7.5 million from a deficit of $7.3 million as of December 31, 2013 to $237,799 at the end of the second quarter. The improvement was generated by the reversal of deferred revenue from the fourth quarter of 2013 and cash flow from operations.
Second quarter results were primarily driven by continued demand by third parties for royalty interests in lower risk oil and gas properties and the sale of third-party drilling participation in the company’s oil and gas properties. The Company’s practice of de-risking its positions in operated wells is expected to continue to be a significant portion of the Company’s ongoing revenue.
Net income of $841,000 was an increase of $625,000 over the same quarter in 2013. 2014 second quarter revenue was partially offset by increased marketing expenses, expenses associated with being a public company and the Texas margin tax on the increased revenues. The Company also had greater than normal royalty interests and third-party drilling marketing costs.
Operations and Production Update
Permian Basin
The Company completed its first well in Sterling County and production is in line with expectations, and the Company also plans to re-enter the well in the third quarter to combine multiple production zones identified in the drilling process, which should increase production. The Company is also in final preparations to spud its second well in early September. Development plans for the subsequent wells are being reviewed and scheduled.
Taylor County, Texas
The Company saw promising early results from the drilling of its first well in its prospect in Taylor County, Texas. This well came online in February and is producing consistent with expectations. The Company is also currently planning its second well in Taylor County before the end of 2014 on a recently acquired lease adjacent to the producing property.
Southern Kansas
The Company completed a multi-stage horizontal frack on its well in southern Kansas. When put into production, the well produced oil and gas at acceptable levels but also produced significant amounts of salt water. The Company is currently monitoring production of the well and evaluating its options with regard to the water production.
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ABOUT BREITLING ENERGY
Breitling Energy Corporation is a growing U.S. energy company based in Dallas engaged in the exploration and development of high-probability, lower risk onshore oil and gas properties. The company’s dual-focused growth strategy primarily relies on leveraging management’s technical and operations expertise to grow through the drill-bit, while also growing its base of non-operating royalty interests. Breitling’s oil and gas operations are focused primarily in the Permian Basin of Texas and the Mississippi oil window of southern Kansas, with non-operating investments in Texas, North Dakota, Oklahoma and Mississippi. Breitling Energy Corporation is traded over the counter under the ticker symbol: BECC. Additional information is available at www.breitlingenergy.com.
FORWARD-LOOKING STATEMENTS
Certain statements in this news release regarding future expectations, access to public capital markets, plans for acquisitions and dispositions, oil and gas reserves, exploration, development, production and pricing may be regarded as "forward-looking statements". They are subject to various risks, such as operating hazards, drilling risks, the inherent uncertainties in interpreting engineering data relating to underground accumulations of oil and gas, as well as other risks discussed in detail in Breitling's periodic reports and other documents filed with the Securities and Exchange Commission (“SEC”).
Any number of factors could cause actual results to differ materially from those in the forward-looking statements, including, but not limited to, the volatility of oil and gas prices, the costs and results of drilling and operations, the timing of production, mechanical and other inherent risks associated with oil and gas production, weather, the availability of drilling equipment, changes in interest rates, litigation, uncertainties about reserve estimates, environmental risks and other risks and uncertainties set forth in Breitling's periodic reports and other documents filed with the SEC. Breitling undertakes no obligation to publicly update or revise any forward-looking statements.
INVESTOR RELATIONS CONTACT: Gilbert Steedley, Breitling, 214.716.2060
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