GeoResources, Inc. Reports Third Quarter and Nine Month 2008 Financial Results

Houston, Texas, November 10, 2008 – GeoResources, Inc., (NASDAQ:GEOI), today announced its financial results for the nine months and the quarter ended September 30, 2008, compared to the results for the same periods in 2007.    
For the three months ended September 30, 2008, the Company reported net income of $5.8 million, or $0.35 per share (diluted) compared to a net income of $1.4 million or $0.10 per share in 2007.  Total revenue increased 174% to $23.6 million in the third quarter of 2008 compared to $8.6 million the same quarter in 2007.
          For the first nine months of 2008, net income was $17.8 million, or $1.14 per share (diluted), on revenue of $75.7 million versus a net income of $949,000, or $0.08 per share on revenue of $21.0 million in the first nine months of 2007.
          The foregoing information is summarized below in tabular form (in thousands, except per share information):

Oil and natural gas production increased substantially in the third quarter 2008 compared to the same period in 2007.  Natural gas production increased to 723 MMcf from 330 MMcf, an increase of 119%.  Oil production for the third quarter increased to 167 MBbls from 88 MBbls in the prior year’s period, an increase of 90%.
For the nine months ended September 30, 2008, natural gas sales totaled 2,251 MMcf or 155% greater than the 883 MMcf sold during the first nine months of 2007.  Oil sales for the first nine months of 2008 increased 156% to 553 Mbbls from 216 Mbbls in the first nine months of 2007.
  The average realized price of natural gas was $9.12 per Mcf for the third quarter of 2008, 62% more than the third quarter of 2007.  The average realized price of oil for the third quarter of 2008 was $90.60 per barrel or 41% more than the third quarter in the prior year.  The average realized price of natural gas was $8.82 per Mcf for the first nine months of 2008 or 41% more than the first nine months of the prior year.  The average realized price of oil was $89.50 per barrel or 53% more for the first nine months of 2008 than the first nine months in the prior year.  Production and price information is shown below in tabular form:

The following tables reconcile reported net income to EBITDAX for the periods indicated (in thousands):

(1) EBITDAX is defined as earnings before interest, income taxes, depreciation, depletion and amortization, and exploration expense.  EBITDAX should not be considered as an alternative to net income (as an indicator of operating performance) or as an alternative to cash flow (as a measure of liquidity or ability to service debt obligations) and is not in accordance with, nor superior to, generally accepted accounting principles, but provides additional information for evaluation of our operating performance.

Comments

Mr. Frank Lodzinski, CEO and president, commented “We are pleased with our reported earnings and cash flows.  We achieved quarterly earnings of $5.8 million, or $0.35 per fully diluted share, in spite of falling prices and production that was shut-in due to hurricanes.   This shut-in production has been phased back in and is expected to be fully restored by early December.  We have built this Company with ‘staying power’ to withstand downturns in the industry and the economy. Our balance sheet is strong and we have significant cash flows and low cost borrowing capacity.    Our borrowing base actually increased in the fourth quarter.  We believe that we can continue to generate net earnings and significant cash flows in 2009, even with commodity prices considerably below current levels.” 

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).

Copyright (C) 2009, GeoResources, Inc . All right reserved.
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