GeoResources, Inc. Reports Second Quarter and Six-Months Financial Results
Houston, Texas August 11, 2008 – GeoResources, Inc., (NASDAQ:GEOI), today announced its financial results for the first six-months and the quarter ended June 30, 2008, compared to the results for the same periods in 2007.
For the three months ended June 30, 2008, the Company reported net income of $7.8 million, or $0.50 per share (diluted) compared to a net loss of $1.3 million or $0.09 per share in 2007. Total revenue increased 240% to $28.2 million in the second quarter of 2008 compared to $8.3 million the same quarter in 2007.
For the first half of 2008, net income was $12.0 million, or $0.80 per share, on revenue of $52.2 million versus a net loss of $463,000, or $0.05 per share on revenue of $12.4 in the first half of 2007.
Oil and natural gas production increased substantially in the second quarter. Natural gas production increased to 719 MMcf from 361 MMcf, an increase of 99%. Oil production for the second quarter increased to 186 MBbls from 82 MBbls in the prior year’s period, an increase of 127%.
For the six months ended June 30, 2008, natural gas sales totaled 1,528 MMcf or 177% greater than the 552 MMcf sold during the first half of 2007. Oil sales for the first half of 2008 increased 204% to 386 Mbbls from 127 Mbbls in the first half of 2007.
The average realized price of natural gas was $9.74 per Mcf for the second quarter of 2008, 41% more than the second quarter of 2007. The average realized price of oil for the second quarter of 2008 was $97.66 per barrel or 75% more than the second quarter in the prior year.
The average realized price of natural gas was $8.68 per Mcf for the first half of 2008 or 31% more than the first half of the prior year. The average realized price of oil was $89.01 per barrel or 63% more for the first half of 2008 than the first six months in the prior year.
Earnings before interest, income taxes, depreciation, depletion and amortization, and exploration expense (“EBITDAX”) increased 581% to approximately $17.7 million for the second quarter 2008 compared to $2.6 million in the second quarter 2007. EBITDAX for the first six-months of 2008 increased 552% to approximately $30.0 million compared to $4.6 million in the prior year’s first half.
SemGroup Bankruptcy
Some investors have expressed concern about the possible impact on our Company of the recent bankruptcy filing by SemGroup LP and its subsidiary, SemCrude. SemCrude accounted for a very minor portion of our oil sales and we estimate that our maximum potential losses are approximately $100,000.
About GeoResources, Inc.
GeoResources, Inc. is an independent oil and gas company engaged in the acquisition and development of oil and gas reserves through an active and diversified program which includes purchases of reserves, re-engineering, and development and exploration activities, currently focused in the Southwest and Gulf Coast, Williston Basin and Rocky Mountains. For more information, visit our website at www.georesourcesinc.com.
Forward-Looking Statements
Information herein contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as "may," "will," "expect," "anticipate," "estimate" or "continue," or comparable words. All statements other than statements of historical facts that address activities that the Company expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read the SEC reports of the Company,readers are encouraged to read our Annual Report on Form 10-KSB/A for the year ended December 31, 2007, and any and all other documents filed with the SEC regarding information about GeoResources for meaningful cautionary language in respect of the forward-looking statements herein. Interested persons are able to obtain free copies of filings containing information about GeoResources, without charge, at the SEC’s Internet site (http://www.sec.gov).
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