ASPG - Financial Results
Aspen Group Reports First Quarter Financial Results For Fiscal Year 2002
November 12, 2001 11:40:00 PM ET
OKLAHOMA CITY--(BUSINESS WIRE)--Nov. 12, 2001-- - Cash Flow from Operations Doubles to $0.06 Per Share - Total Revenue Increases 10% - Increase in Production Offsets Natural Gas Price Decline
Aspen Group Resources Corporation, ASPG (TSE: ASR.), announced today financial results (in U.S. Dollars) for the First Quarter of Fiscal Year 2002 ended September 30, 2001.
For the Quarter, Aspen reported total revenue of $2.3 million, up 10% from the $2.1 million reported for the same period last year. Although oil and gas revenue decreased 11% to $1.9 million, due to significantly lower commodity prices during the Quarter, Aspen was able to offset the decrease through increased production levels and service revenue generated by United Cementing and Acid Co., Aspen's Oil Field Service Company.
Cash flow from operations increased to $1,135,808 or $0.06 per share versus cash flow from operations of $571,014 or $0.03 per share for the same period last year. Net income decreased to ($76,218) or $0.00 per share compared with earnings $434,090 or $0.02 per share in the First Quarter of Fiscal 2001.
"Although commodity prices continued to decline during the Quarter, Aspen was able to maintain its revenue levels through increased production and service revenue generated by our oil field service company", stated Jack E. Wheeler, Chairman and CEO of Aspen. "Overall, we were able to increase production by an estimated 30% over the same period last year, which not only offset our average price decline per BOE of 34%, but contributed significantly to our increased cash flow from operations for the Quarter."
Business Highlights
During the Quarter, Aspen announced that it had signed an agreement to acquire Endeavour Resources Inc. (CDNX:ERU), a Canadian exploration and production company with operations in Western Canada and Texas. The Acquisition is scheduled to close by December 31, 2001 and is accretive to cash flow and earnings. Once completed, the Acquisition will increase Aspen's gross production to approximately 2,250 BOEPD and add approximately 1.2 million BOE in proven reserves. Additional information regarding Endeavour is available on Aspen's Website (www.asgrc.com).
Operational Highlights
Kansas
Aspen completed drilling operations on its five well drilling program in the El Dorado Field. All four of the oil wells were successful and are producing in excess of 102 BOPD of new production. The fifth well, the Robison North 4B, was successfully drilled as a salt-water disposal well. Results for the four producing oil wells are:
- The Robison South # 21 is producing 60 BOPD.
- The Mills # 1X is producing 18 BOPD out of a secondary zone. The
primary zone has not been tested.
- The Frank Robison East # 46 is producing 8 BOPD and will be
treated in the near future to increase production.
- The Marshall "A" # 5 is producing 16 BOPD. These wells will add
approximately 160,000 Bbls of reserves net to Aspen resulting in a
finding cost of slightly less than $2.00/Bbl. Aspen anticipates
payout should occur in less than ten (10) months. Aspen was the
Operator on all the wells.
Oklahoma
Aspen participated in fifteen (15) increased density wells with an average working interest of 4.33%. Included in these was the Ross # 2-21 which went on-line October 23, 2001 flowing 5 MMCFPD from the Lower Morrow Formation through perforations from 18,026-038'. The Well is located in Section 21, Township11 North, Range 25 West of Beckham County, Oklahoma. Aspen Energy Group, Inc. owns a 4.64062% Working Interest and a 3.31800% Net Revenue Interest in the Well.
Aspen also completed drilling operations of the McCaslin # 4-24, a 10,000-foot Morrow Sands Test Well with Aspen as the Operator. The Well encountered shows in the Morrow and Chester Zones and Aspen hopes to be able to have a successful fracturing and completion of the Well in the Chester Zone. Operations on the Well have been temporarily suspended until natural gas prices improve.
Financials
Summary results for Fiscal 2001 are shown in United States Dollars in the following tables. Details are available in the Company's Form 10-Q Report to the United States Securities and Exchange Commission, which was filed today.
Financial Highlights
(In United States Dollars)
Three Months Ended June 30
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2001 2000
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Revenue $ 2,332,077 $ 2,187,562
Expenses 2,408,517 1,753,472
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Net income before
minority interest $ (76,440) $ 434,090
Minority interest 222 -
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Net income after tax(a) $ (65,683) $ 434,909
Net income per share $ 0.00 $ 0.02
Cash flow from operations $ 1,135,808 $ 571,014
Cash flow from operations
per share $ 0.06 $ 0.03
Weighted avg. shares 19,325,657 18,121,278
(a) No income tax due to application of prior losses
Balance Sheet Summary
(In United States Dollars)
Sept30, June 30,
2001 2001
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Assets
Current assets $ 3,098,335 $ 3,902,450
Oil and gas properties
(net of depletion) 49,365,939 47,646,027
Property, equipment and other
assets (net of depreciation) 3,386,041 3,304,442
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Total Assets $ 55,850,315 $ 54,852,919
Liabilities and Stockholders' Equity
Accounts payable and accrued
interest and expenses $ 2,745,284 $ 2,510,181
Notes payable and current
maturities of long term debt 2,291,243 2,321,243
Long term debt, net of
current maturities 15,799,266 15,164,533
Minority Interest - 222
Stockholders' Equity 35,014,522 34,856,740
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Total Liabilities and
Stockholders' Equity $ 55,850,315 $ 54,852,919
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"Our results demonstrate Aspen's ability to weather periods of low commodity prices," added Mr. Wheeler. "Over the past several weeks we have seen strengthening in natural gas prices which will positively impact our top and bottom line results once prices have stabilized."
Mr. Wheeler will host a conference call on November 13, 2001 at 11:30 am eastern standard time (EST) to answer Shareholder questions regarding the Quarterly Results. Interested Parties can email questions Kevin O'Connor at koconnor@asgrc.com. prior to the call or dial toll free 1-877-871-9527 ten minutes prior to the start of the call. For those unable to participate, a replay will be available after 3:00 pm EST on November 13 until November 20, 2001. by dialing 1-800-558-5253, access code 20000227.
Aspen Group Resources Corporation is an independent Oil and Natural Gas Producer engaged in the Acquisition, Exploitation, Production and Development of oil and natural gas properties. Aspen has production and land holdings in eleven states in the US, with core operations focused primarily in Oklahoma, Kansas and Texas. Aspen's shares trade on The Toronto Stock Exchange under the symbol ASR and on the NASDAQ OTC under the symbol ASPG.
Portions of this News Release may include certain "forward-looking statements" made pursuant in the "Safe Harbour" Provision of the Private Securities Litigation Reform Act of 1995. These statements are based on Management's current expectations are subject to uncertainty and changes in circumstances. Actual results may vary materially from management's expectations and projections expressed in this document. Certain factors that can affect the Company's ability to achieve projected results are described in the Company's Annual Report on Form 10-KSB and other Reports filed with the Securities and Exchange Commission.
Contact Information:
Aspen Group Resources Corporation
Kevin O'Connor
877/775-8734 Ext. 26
koconnor@asgrc.com
website: www.asgrc.com
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