Earnings report released today......looks good to me ..EBITDA doubled.
VERSAILLES, Ky.--(BUSINESS WIRE)--April 1, 1998--American Resources of Delaware,
Inc.(NASDAQ Small Cap: GASS - news; the ''Company'') today announced results of operations
for its fiscal year ended December 31, 1997. Financial highlights were as follows:
Company-owned production revenues more than doubled for the fourth consecutive year, up
128% to $19,456,938 as compared with $8,540,569 for 1996. The increase in production
revenues was primarily attributable to the addition of the South Timbalier Block 148
properties which became fully operational late in 1996. Gross revenues for fiscal 1997
increased 15% to $38,032,146, up from $33,039,173 for the comparable period in 1996.
Primarily due to the Company's non-cash impairment of assets and the establishment of a
reserve for future plugging and abandonment costs (discussed below), operating income for
the year decreased to ($321,721) after having been $3,211,826 for 1996; and net income for
1997 decreased to ($1,846,591) as compared with $911,755 for 1996.
Also primarily due to the Company's non-cash impairment of assets and the establishment of a
reserve for future plugging and abandonment costs (discussed below), basic earnings per
share for 1997 decreased to ($0.21) on 9,021,810 weighted average outstanding shares as
compared with 1996 basic earnings per share of $0.14 on 6,123,635 weighted average
outstanding shares.
EBITDA for 1997 nearly doubled to $13,545,443 after having been $7,411,093 for
1996.(a)
During the year ended December 31, 1997, the Company produced 7.134 billion cubic feet
of gas equivalent (bcfe) for average daily production of 19.5 million cubic feet of gas
equivalent (mmcfe), compared with total production of 3.031 bcfe and average daily
production of 8.3 mmcfe during 1996. At year-end 1997, the Company's average production
was at 23 mmcfe per day; and during the month of March 1998, production increased to an
average of 38 mmcfe per day as a result of recent acquisitions of proved producing oil and
gas properties.
As a result of the Company's largest and most significant acquisition of properties from TECO Oil &
Gas, Inc., which closed on March 5, 1998, approximately 90% of the Company's total assets are
currently located in the offshore Gulf of Mexico. As such, the Company has decided to concentrate
its efforts on the exploration and development of its offshore properties and has, therefore, recorded
an impairment to certain non-strategic assets for which there are no plans to develop in the
foreseeable future. The pre-tax, non-cash impairment to assets, together with a reserve for future
plugging and abandonment costs, totalled $5,531,800. These non-cash items impacted the
Company's income but did not impact its cash flow from operating activities. Results for 1997 before
these non-cash items are as follows:
- Operating income up 62% to $5,210,079;
- Net income up 55% to $1,417,171;
- Earnings per share up 7% to $0.15.
After the impairment to assets, the Company's total assets were $61.6 MM at year-end 1997 as
compared with $64.8 MM at December 31, 1996. However, after giving effect to the $57.7 MM
acquisition of the TECO properties during the first quarter of 1998, the Company's total assets
currently exceed $110 MM.
Rick G. Avare, President and CEO, stated: ''Management believes that the decision to write down
certain non-strategic assets will enable the Company to clearly reflect the results of operations from
its core assets in the future. We view our offshore Gulf properties as the foundation for our continued
growth and spent the majority of 1997 expanding and enhancing them. Our strategic acquisition of
significant offshore Gulf properties during the first quarter of this year and the establishment of a new
wholly owned-subsidiary (American Resources Offshore, Inc.) to manage our Gulf operations will
allow us to be totally focused on an aggressive exploration and development program in the Gulf for
the remainder of the twentieth century and beyond.''
EARNINGS RECAP:
Year Ended
December 31
----------- 1997 1996
1997 1996
----------- -----------
Revenue $38,032,146 $33,039,173
=========== ===========
Net income (loss) ($ 1,846,591)(b) $ 911,755
=========== ===========
Net income (loss) per share ($ 0.21) $ 0.14
=========== ===========
Basic weighted average
shares outstanding 9,021,810 6,123,635
=========== ===========
OTHER FINANCIAL DATA:
EBITDA(1) $13,545,443 $ 7,411,093
=========== ===========
(a) EBITDA is earnings before interest, taxes, depreciation/depletion
and amortization/impairment. EBITDA is presented because it is a
widely accepted financial indication of a company's ability to
service and incur debt. EBITDA should not be considered as an
alternative to earnings (loss) as an indicator of the Company's
operating performance or to cash flow as a measure of liquidity.
(b) Includes a pre-tax, non-cash impairment to assets and a reserve
for future plugging and abandonment costs totalling $5,531,800.
American Resources of Delaware, Inc. is a fully integrated producer of oil and gas. The Company
owns pipelines and production located primarily in the Gulf Coast region.
For information, contact the Company's Investor Relations Department at 606/873-5455, or visit
our website at www.arisgc.com.
AMERICAN RESOURCES OF DELAWARE, INC.
AND SUBSIDIARY
CONDENSED, CONSOLIDATED STATEMENT OF OPERATIONS
Year Ended
December 31
-----------
1997 1996
----------- -----------
Revenues $38,032,146 $33,039,173
=========== ===========
Income (loss) from
operations ($ 321,721)(c) $ 3,211,826
Other income (expense) ($ 2,717,344) ($ 1,661,131)
Income taxes $ 1,192,474 ($ 638,940)(d)
----------- -----------
Net income (loss) ($ 1,846,591) $ 911,755
=========== ===========
EARNINGS PER SHARE:
Basic:
Income (loss) from
operations ($0.04) $0.51
Other income (expense) ($0.30) ($0.27)
Income taxes $0.13 ($0.10)
----- -----
Net income (loss) ($0.21) $0.14
===== =====
(c) Includes a non-cash impairment to assets and a reserve for future
plugging and abandonment costs totalling $5,531,800.
(d) $613,281 is deferred. |
