Revenues of $8.7 Million, Up 276% Year-Over-Year
Income from Operations of $2.3 Million
HOUSTON, Aug. 13, 2019 (GLOBE NEWSWIRE) -- Viking Energy Group, Inc. (OTCQB: VKIN) (“Viking” or the “Company”), an independent exploration and production company focused on the acquisition and development of oil and natural gas properties in the onshore Gulf Coast and Mid-Continent regions, today announced financial results for the second quarter ended June 30, 2019.
Key Financial Highlights for Second Quarter 2019 (all figures are approximate):
- Net production averaged 2,561 BOE per day, up 527% compared to Q-2 2018
- Oil volume averaged 1,468 Bbls per day, up over 262% from Q-2 2018
- Gas volume averaged 6,560 Mcf per day, where Q2 2018 only averaged 13 Mcf per day
- Revenues increased by over 276% to $8.7 million as compared to $2.3 million for the second quarter of 2018.
- Revenue in excess of lease operating costs increased to $5.6 million (65% of total revenue) as compared to $1.3 million (55% of total revenue) for the second quarter of 2018.
- Income from operations improved to a profit of $2.3 million, as compared to a loss of $1.4 million in the second quarter of 2018
- Net income of $1.3 million, as compared to a loss of $3.9 million in the second quarter of 2018
- EPS of $0.01 from a loss of ($0.05) in the second quarter 2018
- Cash balance of $5.0 million (the majority of the cash is within the Company’s Ichor division and subject to the terms of the credit agreement involving the Ichor entities)
- Total book value of assets exceeds $134 million
James Doris, Viking’s President and Chief Executive Officer, commented, “Throughout 2019 we have strived to optimize production and control operating costs through responsible maintenance initiatives as well as strategic sales and acquisitions. We believe we have established a strong foundation, and enhanced our credibility in relevant markets. While we have additional work to perform to achieve desired results, I’m very excited with the state of the company today versus one year ago. Attaining income from operations and profitability has been our goal from the onset. We are focused on improving our balance sheet in order to provide us with the flexibility to pursue new opportunities, including with respect to existing properties and new assets. I believe we are better positioned than ever before to increase shareholder value given our infrastructure, talented personnel and support from existing stakeholders.”
The following table summarizes the Company’s oil and gas activities by classification for the six months ended June 30, 2019:
| December 31, 2018 | Adjustments | Impairments | June 30, 2019 | |||||||||||||
| Proved developed producing oil and gas properties | ||||||||||||||||
| United States cost center | $ | 81,936,721 | $ | (1,476,634 | ) | $ | - | $ | 80,460,087 | |||||||
| Accumulated depreciation, depletion and amortization | (604,735 | ) | (3,353,247 | ) | - | (3,957,982 | ) | |||||||||
| Proved developed producing oil and gas properties, net | $ | 81,331,986 | $ | (4,829,881 | ) | $ | - | $ | 76,502,105 | |||||||
| Undeveloped and non-producing oil and gas properties | ||||||||||||||||
| United States cost center | $ | 51,973,719 | $ | (87,140 | ) | $ | - | $ | 51,886,579 | |||||||
| Accumulated depreciation, depletion and amortization | (1,480,813 | ) | (1,215,154 | ) | - | (2,695,967 | ) | |||||||||
| Undeveloped and non-producing oil and gas properties, net | $ | 50,492,906 | $ | (1,302,294 | ) | $ | - | $ | 49,190,612 | |||||||
| Total Oil and Gas Properties, Net | $ | 131,824,892 | $ | (6,132,175 | ) | $ | - | $ | 125,692,717 | |||||||
Financial Results for the Three and Six Months Ended June 30, 2019:
| Analysis of Total Revenues and corresponding Lease Operating Costs for the Three and Six Months Ended June 30, 2019 | |||||||||||||||||||||||
| as compared to the year ended December 31, 2018 on an annual basis as well as on a quarterly basis | |||||||||||||||||||||||
| Financial Data for the Year Ended December 31, 2018 | Three Months | Six Months | |||||||||||||||||||||
| Quarter Ended Totals | Twelve Months | Ended | Ended | ||||||||||||||||||||
| 3/31/2018 | 6/30/2018 | 9/30/2018 | 12/31/2018 | 12/31/2018 | 6/30/2019 | 6/30/2019 | |||||||||||||||||
| Total Revenue - Oil and Gas | $ | 2,161,947 | $ | 2,318,622 | $ | 1,895,932 | $ | 1,591,471 | $ | 7,967,972 | $ | 8,734,323 | $ | 18,080,915 | |||||||||
| Lease Operating Costs (LOE) | 1,008,268 | 1,035,474 | 913,331 | 878,476 | 3,835,549 | 3,094,064 | 5,693,458 | ||||||||||||||||
| Revenue in excess of lease operating costs | $ | 1,153,679 | $ | 1,283,148 | $ | 982,601 | $ | 712,995 | $ | 4,132,423 | $ | 5,640,259 | $ | 12,387,457 | |||||||||
| LOE as a % of Total Revenue | 47 | % | 45 | % | 48 | % | 55 | % | 48 | % | 35 | % | 31 | % | |||||||||
| Revenue in excess of lease operating costs as a % of Total Revenue | 53 | % | 55 | % | 52 | % | 45 | % | 52 | % | 65 | % | 69 | % | |||||||||
| Analysis of Crude Oil and Natural Gas Production for the Three and Six Months Ended June 30, 2019 | |||||||||||||||||||||||
| as compared to the year ended December 31, 2018 on an annual basis as well as on a quarterly basis | |||||||||||||||||||||||
| Financial Data for the Year Ended December 31, 2018 | Three Months | Six Months | |||||||||||||||||||||
| Quarter Ended Totals | Twelve Months | Ended | Ended | ||||||||||||||||||||
| 3/31/2018 | 6/30/2018 | 9/30/2018 | 12/31/2018 | 12/31/2018 | 6/30/2019 | 6/30/2019 | |||||||||||||||||
| Total Crude Production (bbls) | 33,425.61 | 36,985.93 | 30,990.66 | 29,487.04 | 130,889.24 | 133,589.43 | 277,974.29 | ||||||||||||||||
| Avg $ / bbl | $ | 61.47 | $ | 65.72 | $ | 63.61 | $ | 56.47 | $ | 62.05 | $ | 62.42 | $ | 60.69 | |||||||||
| Total Gas Production (mcf) | 41,615.92 | 1,168.81 | 6,665.29 | 7,235.17 | 56,685.19 | 596,951.75 | 1,119,359.60 | ||||||||||||||||
| Avg $ / mcf | $ | 3.17 | $ | 7.90 | $ | 3.50 | $ | 3.67 | $ | 3.37 | $ | 2.58 | $ | 2.82 | |||||||||
| BOE - Barrel of Oil Equivalent | 40,361.60 | 37,180.73 | 32,101.54 | 30,692.90 | 140,336.77 | 233,081.39 | 464,534.22 | ||||||||||||||||
The Company generated gross revenues of $8.7 million for the three months ended June 30, 2019, as compared to $2.3 million for the three months ended June 30, 2018, reflecting an increase in excess of 276% or $6.4 million. This substantial increase in revenue is primarily a result of the increased production from the oil and gas assets acquired at the end of 2018.
Revenue in excess of lease operating costs of $5.6 million for the three months ended June 30, 2019 represents a 65% margin on total revenues, as compared to $1.3 million for the three-month period ended June 30, 2018, which reflected a 55% margin on total revenue. The increase in margins is attributed to the acquisition of more productive assets, enhancement initiatives, disposition of marginal properties, and an effort to control costs.
The Company, through the increased production from its latest acquisition, and controlling operational and administrative costs, generated an income from operations totaling $2.3 million for the three months ended June 30, 2019, as compared to a loss from operations of $1.4 million for the three months ended June 30, 2018.
The Company realized a net income of $1.3 million during the three-month period ended June 30, 2019, compared with a net loss of $3.9 million for the three-month period ended June 30, 2018.
At June 30, 2019, Viking had approximately 91.2 million shares issued and outstanding.
Note: The figures referenced in the summaries above are approximate and in most cases have been rounded to the nearest $100,000. For specific amounts, please refer to Viking’s Quarterly Report on Form 10-Q filed on August 12, 2019 with the Securities and Exchange Commission and available under "Investors -- SEC Filings" at www.vikingenergygroup.com.
About Viking Energy Group, Inc.
Viking is an independent exploration and production company focused on the acquisition and development of oil and natural gas properties in North America. The company owns oil and gas leases in Texas, Louisiana, Mississippi and Kansas. Viking targets under-valued assets with realistic appreciation potential.
For additional information, please visit: https://www.vikingenergygroup.com.
Forward-Looking Statements
This press release may contain forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and any statements that are not historical facts contained in this press release are "forward-looking statements" as that term is defined under the Private Securities Litigation Reform Act of 1995 (“PSLRA”), which statements may be identified by words such as "expects," "plans," "projects," "will," "may," "anticipates," "believes," "should," "intends," "estimates," and other words of similar meaning. Such forward-looking statements are based on current expectations, involve known and unknown risks, a reliance on third parties for information, transactions that may be cancelled, and other factors that may cause our actual results, performance or achievements, or developments in our industry, to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from anticipated results include risks and uncertainties related to the fluctuation of global economic conditions or economic conditions with respect to the oil and gas industry, the performance of management, actions of government regulators, vendors, and suppliers, our cash flows and ability to obtain financing, competition, general economic conditions and other factors that are detailed in our filings with the Securities and Exchange Commission (“SEC”), including our Annual Report on Form 10-K for the year ending December 31, 2018, and our Quarterly Reports on Form 10-Q for the quarters ending March 31, 2019, and June 30, 2019. We intend that all forward-looking statements be subject to the safe-harbor provisions of the PSLRA.
Contact Information
Investors and Media:
p917-841-5859
IR@vikingenergygroup.com