EX-99.1 2 yuma_ex991.htm PRESS RELEASE Blueprint
  Exhibit 99.1
Yuma Energy, Inc.
 
 
 
 
NEWS RELEASE
 
Yuma Energy, Inc. Announces Third Quarter 2017
Financial Results
 
HOUSTON, TX – (PR Newswire – November 13, 2017) – Yuma Energy, Inc. (NYSE American: YUMA) (the “Company” or “Yuma”) today announced its financial results for the quarter ended September 30, 2017.
 
Third Quarter 2017 Highlights
 
●
Net average production of 2,348 Boe/d for the third quarter of 2017, a 53.5 percent increase over the third quarter of 2016.
 
●
Cash provided by operations of $4,472,028 for the nine months ended September 30, 2017, compared to cash used in operations of $927,802 in the same period in 2016.
 
●
Yuma’s Permian Basin acreage position has increased to 3,068 acres (2,685 net acres) in Yoakum County, Texas to horizontally develop the San Andres Oil Play. Yuma is the operator of the acreage with an 87.5 percent working interest, and has spud its salt water disposal well and intends to drill its first joint venture well in 2017, as well as continue to acquire additional acreage within its 33,280 acre Area of Mutual Interest (“AMI”).
 
●
Yuma’s borrowing base on its credit facility was reaffirmed on September 8, 2017 at $40.5 million, with the next scheduled redetermination set for April 1, 2018.
 
Recent Developments
 
●
Yuma closed its common stock offering of 9,600,000 shares of common stock on October 3, and subsequently on October 31, 2017, the Underwriters exercised their overallotment option and purchased 500,000 additional shares of common stock to bring the total gross proceeds of the offering to $10,100,000 before deducting underwriters’ fees and offering expenses.
 
Management Comments
 
Sam L. Banks, CEO of Yuma Energy, Inc., commented, “We have continued to increase our acreage position in the Permian Basin at very attractive prices and are currently preparing to drill our first horizontal well and salt water disposal well in the San Andres horizontal oil play. We intend to finish drilling operations for both wells in 2017 and to establish commercial production during the first quarter of 2018. We continue to believe that increasing our exposure to the Permian Basin, and more specifically the San Andres horizontal oil play, will lead to significant shareholder value over time. As can be seen in the results of our first three quarters, the merger with Davis has improved our cash flows and financial position and significantly increased our production.”
 
 
 
 
Financial Results
 
Production
 
The following table presents the net quantities of oil, natural gas and natural gas liquids produced and sold by us for the three and nine months ended September 30, 2017 and 2016, and the average sales price per unit sold.
 
 
 
Three Months Ended
September 30,
 
 
Nine Months Ended
September 30,
 
 
 
2017
 
 
2016
 
 
2017
 
 
2016
 
Production volumes:
 
 
 
 
 
 
 
 
 
 
 
 
Crude oil and condensate (Bbls)
  57,134 
  32,242 
  199,774 
  106,257 
Natural gas (Mcf)
  757,361 
  507,521 
  2,442,899 
  1,553,906 
Natural gas liquids (Bbls)
  32,694 
  23,903 
  101,260 
  74,282 
Total (Boe) (1)
  216,055 
  140,732 
  708,184 
  439,523 
Average prices realized:
    
    
    
    
  Crude oil and condensate (per Bbl)
 $47.86 
 $43.45 
 $48.42 
 $39.27 
  Natural gas (per Mcf)
 $3.04 
 $2.46 
 $3.05 
 $2.12 
  Natural gas liquids (per Bbl)
 $23.81 
 $16.66 
 $23.68 
 $14.96 
 
(1)
Barrels of oil equivalent have been calculated on the basis of six thousand cubic feet (Mcf) of natural gas equal to one barrel of oil equivalent (Boe).
 
Revenues
 
The following table presents our revenues for the three and nine months ended September 30, 2017 and 2016.
 
 
Three Months Ended
September 30,
 
 
Nine Months Ended
September 30,
 
 
 
2017
 
 
2016
 
 
2017
 
 
2016
 
Sales of natural gas and crude oil:
 
 
 
 
 
 
 
 
 
 
 
 
Crude oil and condensate
 $2,734,269 
 $1,400,837 
 $9,673,049 
 $4,172,477 
Natural gas
  2,304,154 
  1,249,148 
  7,445,564 
  3,295,258 
Natural gas liquids
  778,460 
  398,264 
  2,397,398 
  1,111,402 
Total revenues
 $5,816,883 
 $3,048,249 
 $19,516,011 
 $8,579,137 
 
 Expenses
 
The Company’s lease operating expenses (“LOE”) and LOE per Boe for the three and nine month periods ended September 30, 2017 and 2016, are set forth below:
 
 
 
Three Months Ended
September 30,
 
 
Nine Months Ended
September 30,
 
 
 
2017
 
 
2016
 
 
2017
 
 
2016
 
Lease operating expenses
 $1,506,747 
 $810,115 
 $5,049,551 
 $2,043,298 
Severance, ad valorem taxes and
    
    
    
    
marketing
  1,002,605 
  423,511 
  3,180,189 
  1,268,104 
  Total LOE
 $2,509,352 
 $1,233,626 
 $8,229,740 
 $3,311,402 
 
    
    
    
    
LOE per Boe
 $11.61 
 $8.77 
 $11.62 
 $7.53 
LOE per Boe without severance,
    
    
    
    
ad valorem taxes and marketing
 $6.97 
 $5.76 
 $7.13 
 $4.65 
 
 
 
 
Commodity Derivative Instruments
 
Commodity derivative instruments open as of September 30, 2017 are provided below. Natural gas prices are NYMEX Henry Hub prices, and crude oil prices are NYMEX West Texas Intermediate.
 
 
 
 
2017
 
 
2018
 
 
2019
 
 
 
Settlement
 
 
Settlement
 
 
Settlement
 
NATURAL GAS (MMBtu):
 
 
 
 
 
 
 
 
 
Swaps
 
 
 
 
 
 
 
 
 
Volume
  517,916 
  1,725,133 
  373,906 
Price
 $3.13 
 $3.00 
 $3.00 
 
    
    
    
3-way collars
    
    
    
Volume
  41,712 
  - 
  - 
Ceiling sold price (call)
 $3.39 
  - 
  - 
Floor purchased price (put)
 $3.03 
  - 
  - 
Floor sold price (short put)
 $2.47 
  - 
  - 
 
    
    
    
CRUDE OIL (Bbls):
    
    
    
Swaps
    
    
    
Volume
  31,927 
  195,152 
  156,320 
Price
 $52.24 
 $53.17 
 $53.77 
 
    
    
    
3-way collars
    
    
    
Volume
  26,637 
  - 
  - 
Ceiling sold price (call)
 $77.00 
  - 
  - 
Floor purchased price (put)
 $60.00 
  - 
  - 
Floor sold price (short put)
 $45.00 
  - 
  - 
 
About Yuma Energy, Inc.
 
Yuma Energy, Inc., a Delaware corporation, is an independent Houston-based exploration and production company focused on acquiring, developing and exploring for conventional and unconventional oil and natural gas resources. Historically, the Company’s operations have focused on onshore properties located in central and southern Louisiana and southeastern Texas where it has a long history of drilling, developing and producing both oil and natural gas assets. More recently, the Company has begun acquiring acreage in Yoakum County, Texas, with plans to explore and develop oil and natural gas assets in the Permian Basin. Finally, the Company has operated positions in Kern County, California, and non-operated positions in the East Texas Woodbine and the Bakken Shale in North Dakota. Its common stock is listed on the NYSE American under the trading symbol “YUMA.”
 
 
 
 
Forward-Looking Statements
 
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Statements that are not strictly historical statements constitute forward-looking statements and may often, but not always, be identified by the use of such words such as “expects,” “believes,” “intends,” “anticipates,” “plans,” “estimates,” “potential,” “possible,” or “probable” or statements that certain actions, events or results “may,” “will,” “should,” or “could” be taken, occur or be achieved. The forward-looking statements include statements about future operations, and estimates of reserve and production volumes. Forward-looking statements are based on current expectations and assumptions and analyses made by the Company in light of experience and perception of historical trends, current conditions and expected future developments, as well as other factors appropriate under the circumstances. However, whether actual results and developments will conform with expectations is subject to a number of risks and uncertainties, including but not limited to: the risks of the oil and gas industry (for example, operational risks in exploring for, developing and producing crude oil and natural gas); risks and uncertainties involving geology of oil and natural gas deposits; the uncertainty of reserve estimates; revisions to reserve estimates as a result of changes in commodity prices; the uncertainty of estimates and projections relating to future production, costs and expenses; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; health, safety and environmental risks and risks related to weather; further declines in oil and natural gas prices; inability of management to execute its plans to meet its goals, shortages of drilling equipment, oil field personnel and services, unavailability of gathering systems, pipelines and processing facilities and the possibility that government policies may change.  The Company’s annual report on Form 10-K for the year ended December 31, 2016, recent quarterly reports on Form 10-Q, recent current reports on Form 8-K, and other Securities and Exchange Commission filings discuss some of the important risk factors identified that may affect its business, results of operations, and financial condition. The Company undertakes no obligation to revise or update publicly any forward-looking statements, except as required by law.
 
For more information, please contact:
 
James J. Jacobs
Executive Vice President, Treasurer and Chief Financial Officer
Yuma Energy, Inc.
1177 West Loop South, Suite 1825
Houston, TX 77027
Telephone: (713) 968-7000
 
 
 
 
Yuma Energy, Inc.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
 
 
September 30,
 
 
December 31,
 
 
 
2017
 
 
2016
 
 
 
 
 
 
 
 
ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT ASSETS:
 
 
 
 
 
 
Cash and cash equivalents
 $270,359 
 $3,625,686 
Accounts receivable, net of allowance for doubtful accounts:
    
    
Trade
  3,893,803 
  4,827,798 
Officers and employees
  48,575 
  68,014 
Common stock subscription receivable
  8,690,400 
  - 
Other
  1,186,320 
  1,757,337 
Commodity derivative instruments
  359,965 
  - 
Prepayments
  347,529 
  1,063,418 
Other deferred charges
  437,165 
  284,305 
 
    
    
Total current assets
  15,234,116 
  11,626,558 
 
    
    
OIL AND GAS PROPERTIES (full cost method):
    
    
Proved properties
  490,280,184 
  488,723,905 
Unproved properties - not subject to amortization
  5,584,644 
  3,656,989 
 
    
    
 
  495,864,828 
  492,380,894 
Less: accumulated depreciation, depletion and amortization
  (418,916,482)
  (410,440,433)
 
    
    
Net oil and gas properties
  76,948,346 
  81,940,461 
 
    
    
OTHER PROPERTY AND EQUIPMENT:
    
    
Land, buildings and improvements
  1,600,000 
  1,600,000 
Other property and equipment
  2,845,459 
  7,136,530 
 
  4,445,459 
  8,736,530 
Less: accumulated depreciation and amortization
  (1,369,302)
  (5,349,145)
 
    
    
Net other property and equipment
  3,076,157 
  3,387,385 
 
    
    
OTHER ASSETS AND DEFERRED CHARGES:
    
    
Commodity derivative instruments
  415,091 
  - 
Deposits
  467,592 
  467,306 
Other noncurrent assets
  333,587 
  517,201 
 
    
    
Total other assets and deferred charges
  1,216,270 
  984,507 
 
    
    
TOTAL ASSETS
 $96,474,889 
 $97,938,911 
 
 
 
 
Yuma Energy, Inc.
CONSOLIDATED BALANCE SHEETS – CONTINUED
(Unaudited)
 
 
 
September 30,
 
 
December 31,
 
 
 
2017
 
 
2016
 
 
 
 
 
 
 
 
LIABILITIES AND EQUITY
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT LIABILITIES:
 
 
 
 
 
 
Current maturities of debt
 $- 
 $599,341 
Accounts payable, principally trade
  12,922,251 
  11,009,631 
Commodity derivative instruments
  - 
  1,340,451 
Asset retirement obligations
  359,659 
  376,735 
Other accrued liabilities
  1,875,211 
  2,572,680 
 
    
    
Total current liabilities
  15,157,121 
  15,898,838 
 
    
    
LONG-TERM DEBT
  31,450,000 
  39,500,000 
 
    
    
OTHER NONCURRENT LIABILITIES:
    
    
Asset retirement obligations
  9,717,448 
  9,819,648 
Commodity derivative instruments
  - 
  1,215,551 
Deferred rent
  286,907 
  - 
Employee stock awards
  93,669 
  - 
 
    
    
Total other noncurrent liabilities
  10,098,024 
  11,035,199 
 
    
    
COMMITMENTS AND CONTINGENCIES (Note 14)
    
    
 
    
    
EQUITY
    
    
Series D convertible preferred stock
    
    
($0.001 par value, 7,000,000 authorized, 1,871,373 issued as of September 30,
    
    
2017, and 1,776,718 issued as of December 31, 2016, $11.07 per share
    
    
liquidation preference)
  1,872 
  1,777 
Common stock
    
    
($0.001 par value, 100 million shares authorized, 12,559,608 outstanding as of
    
    
September 30, 2017 and 12,201,884 outstanding as of December 31, 2016)
  12,560 
  12,202 
Common stock subscribed (9,600,000 shares, funds received October 3, 2017)
  9,600 
  - 
Additional paid-in capital
  54,035,879 
  43,877,563 
Treasury stock at cost (12,433 shares as of September 30, 2017 and -0- shares as
    
    
of December 31, 2016)
  (24,432)
  - 
Accumulated earnings (deficit)
  (14,265,735)
  (12,386,668)
 
    
    
Total equity
  39,769,744 
  31,504,874 
 
    
    
TOTAL LIABILITIES AND EQUITY
 $96,474,889 
 $97,938,911 
 
 
 
 
Yuma Energy, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 
 
 
Three Months Ended
September 30,
 
 
Nine Months Ended
September 30,
 
 
 
2017
 
 
2016
 
 
2017
 
 
2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
REVENUES:
 
 
 
 
 
 
 
 
 
 
 
 
Sales of natural gas and crude oil
 $5,816,883 
 $3,048,249 
 $19,516,011 
 $8,579,137 
 
    
    
    
    
EXPENSES:
    
    
    
    
Lease operating and production costs
  2,509,352 
  1,233,626 
  8,229,740 
  3,311,402 
General and administrative – stock-based
    
    
    
    
compensation
  414,660 
  380,460 
  851,492 
  1,664,855 
General and administrative – other
  1,622,528 
  1,717,627 
  5,705,159 
  8,153,874 
Depreciation, depletion and amortization
  2,761,668 
  1,524,877 
  8,666,052 
  5,357,207 
Asset retirement obligation accretion expense
  138,867 
  51,885 
  418,890 
  158,960 
Impairment of oil and gas properties
  - 
  12,735 
  - 
  17,560,918 
Bad debt expense net of recoveries
  (38,706)
  16,602 
  34,807 
  32,352 
Total expenses
  7,408,369 
  4,937,812 
  23,906,140 
  36,239,568 
 
    
    
    
    
LOSS FROM OPERATIONS
  (1,591,486)
  (1,889,563)
  (4,390,129)
  (27,660,431)
 
    
    
    
    
OTHER INCOME (EXPENSE):
    
    
    
    
Net gains (losses) from commodity derivatives
  (1,260,280)
  128,177 
  4,434,583 
  (161,161)
Interest expense
  (429,313)
  (81,168)
  (1,407,689)
  (195,006)
Gain (loss) on other property and equipment
  - 
  - 
  484,768 
  - 
Other, net
  14,043 
  1,157 
  56,110 
  14,622 
Total other income (expense)
  (1,675,550)
  48,166 
  3,567,772 
  (341,545)
 
    
    
    
    
INCOME (LOSS) BEFORE INCOME TAXES
  (3,267,036)
  (1,841,397)
  (822,357)
  (28,001,976)
 
    
    
    
    
Income tax expense
  2,539 
  33,635 
  8,489 
  6,866 
 
    
    
    
    
NET INCOME (LOSS)
  (3,269,575)
  (1,875,032)
  (830,846)
  (28,008,842)
 
    
    
    
    
PREFERRED STOCK:
    
    
    
    
Dividends paid in kind
  359,311 
  335,199 
  1,048,221 
  981,347 
 
    
    
    
    
NET INCOME (LOSS) ATTRIBUTABLE TO
    
    
    
    
COMMON STOCKHOLDERS
 $(3,628,886)
 $(2,210,231)
 $(1,879,067)
 $(28,990,189)
 
    
    
    
    
INCOME (LOSS) PER COMMON SHARE:
    
    
    
    
Basic
 $(0.29)
 $(0.30)
 $(0.15)
 $(3.89)
Diluted
 $(0.29)
 $(0.30)
 $(0.15)
 $(3.89)
 
    
    
    
    
WEIGHTED AVERAGE NUMBER OF
    
    
    
    
COMMON SHARES OUTSTANDING:
    
    
    
    
Basic
  12,483,724 
  7,444,542 
  12,311,087 
  7,446,986 
Diluted
  12,483,724 
  7,444,542 
  12,311,087 
  7,446,986 
 
 
 
 
Yuma Energy, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 
 
 
Nine Months Ended
September 30,
 
 
 
2017
 
 
2016
 
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
 
 
 
Reconciliation of net income (loss) to net cash provided by (used in)
 
 
 
 
 
 
 operating activities:
 
 
 
 
 
 
Net income (loss)
 $(830,846)
 $(28,008,842)
Depreciation, depletion and amortization of property and equipment
  8,666,052 
  5,357,207 
Impairment of oil and gas properties
  - 
  17,560,918 
Amortization of debt issuance costs
  277,293 
  - 
Net deferred income tax expense
  - 
  6,866 
Deferred rent liability, net
  163,962 
  - 
Stock-based compensation expense
  851,492 
  1,664,855 
Settlement of asset retirement obligations
  (430,415)
  (17,890)
Accretion of asset retirement obligation
  418,890 
  158,960 
Bad debt expense
  34,807 
  32,352 
Net (gains) losses from commodity derivatives
  (4,434,583)
  161,161 
Gain on sales of fixed assets
  (556,141)
  - 
Loss on write-off of abandoned facilities
  71,373 
  - 
Gain on write-off of liabilities net of assets
  (34,835)
  - 
Changes in assets and liabilities:
    
    
Decrease in accounts receivable
  736,959 
  2,988,184 
(Increase) decrease in prepaids, deposits and other assets
  715,603 
  656,948 
(Decrease) increase in accounts payable and other current and
    
    
non-current liabilities
  (1,177,583)
  (1,488,521)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
  4,472,028 
  (927,802)
 
    
    
CASH FLOWS FROM INVESTING ACTIVITIES:
    
    
Capital expenditures for oil and gas properties
  (5,964,781)
  (9,878,724)
Proceeds from sale of oil and gas properties
  5,400,563 
  - 
Proceeds from sale of other fixed assets
  645,791 
  - 
Derivative settlements
  1,103,525 
  1,319,517 
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
  1,185,098 
  (8,559,207)
 
    
    
CASH FLOWS FROM FINANCING ACTIVITIES:
    
    
Proceeds from borrowings
  - 
  9,000,000 
Net repayments on the senior credit facility
  (8,050,000)
  - 
Repayments of borrowings - insurance financing
  (599,341)
  - 
Debt issuance costs
  (323,593)
  - 
Costs for common stock offering
  (15,087)
  - 
Treasury stock repurchases
  (24,432)
  (408,323)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
  (9,012,453)
  8,591,677 
 
    
    
NET DECREASE IN CASH AND CASH EQUIVALENTS
  (3,355,327)
  (895,332)
 
    
    
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
  3,625,686 
  4,064,094 
 
    
    
CASH AND CASH EQUIVALENTS AT END OF PERIOD
 $270,359 
 $3,168,762 
 
    
    
Supplemental disclosure of cash flow information:
    
    
Interest payments (net of interest capitalized)
 $1,021,249 
 $193,985 
Income tax refund
 $20,699 
 $- 
Supplemental disclosure of significant non-cash activity:
    
    
(Increase) decrease in capital expenditures financed by accounts payable
 $(3,291,386)
 $498,140 
Common stock subscription receivable (net of $909,600 offering costs at closing)
 $8,690,400 
 $- 
Other accrued offering expenses
 $271,227 
 $-