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Dune Energy Reports Fourth Quarter And Full Year 2012 Results -Updates Operations And Year-End Reserves



    Dune Energy Reports Fourth Quarter And Full Year 2012 Results -Updates
                       Operations And Year-End Reserves

PR Newswire

HOUSTON, March 8, 2013

HOUSTON, March 8, 2013 /PRNewswire/ -- Dune Energy, Inc. (OCTBB:DUNR) today
announced results for the fourth quarter and calendar year 2012 and provided
an operational update.

Revenue and Production

Revenue for the fourth quarter totaled $12.0 million and $52.0 million for the
full year 2012.  This compares with $14.5 million and $62.9 million for the
fourth quarter and full year 2011, respectively.  Production volumes in the
fourth quarter were 1.1 Bcfe and 5.3 Bcfe for the full year 2012.  This
compares with 1.3 Bcfe for the fourth quarter of 2011, and 5.8 Bcfe for the
full year 2011.  In 2012, the average sales price of oil was $105.54 per
barrel, and $3.20 per Mcf for natural gas, as compared with $102.64 per barrel
and $4.58 per Mcf, respectively for 2011.  Production declined almost 10% in
2012 as compared to 2011.  Oil prices increased 3% and gas prices decreased
30% from 2011 levels.  During 2012 oil accounted for 47% of the total
production volumes on an Mcfe equivalent basis, however oil revenue accounted
for 83% of the total revenue.

Costs and Expenses

Total operating expenses were $26.0 million for 2012 as compared to $26.1
million for 2011 or $4.93 and $4.48 per Mcfe produced respectively.  This
increase on a per Mcfe basis was reflective of lower production volumes in
2012 in our older fields with high fixed cost expenses.  DD&A expense was $3.9
million for the fourth quarter and $14.1 million for 2012 or $2.67 per Mcfe. 
G&A expense totaled $2.8 million for the fourth quarter and $10.4 million for
2012.  G&A for 2011 was $9.6 million.  Included in G&A was $1.7 million of
stock based compensation in 2012 and $0.5 million in 2011.  Cash G&A was $8.7
million in 2012 and $9.1 million in 2011.  Interest and financing expense was
$2.6 million for the fourth quarter and $9.8 million for 2012.  As part of the
restructuring on December 22, 2011 the term loan was repaid and replaced with
a $200 million revolving credit facility under which $28 million was borrowed
at year-end 2012 and $2 million in letters of credit were outstanding.  Also
as part of the restructuring, the $300 million of Senior Secured notes were
reduced to $3.0 million at year-end 2011 and new notes of $49.5 million with a
maturity of 2016 were added.  This amount has increased to $55.4 million as of
December 31, 2012 due to the notes payment-in-kind feature.

Earnings

Net loss available to common shareholders totaled $3.7 million for the fourth
quarter of 2012 and $7.9 million for the full year 2012.  This compares with
an $80.6 million loss in 2011.   Preferred stock dividends were $20.2 million
in 2011.  The preferred stock was eliminated as part of the December 22, 2011
restructuring so there were no preferred stock dividends in 2012. 

Liquidity

At the end of the year we had $22.8 million in cash and $22 million available
under our Credit Facility based on $50 million of availability.  Such
availability is subject to an EBITDAX to Total Debt Covenant of 4.0 to 1.0
beginning at the end of the first quarter of 2013.  Such covenants may limit
our availability under the revolver.  The availability is also subject to a
semiannual redetermination based on the Company's reserve report.

Year-End 2012 Reserves

Year-end 2012 proved reserves were 6,585 MBO and 50.6 Bcf or 90.1 Bcfe.  PV @
10% value of these reserves in accordance with applicable financial and
reporting standards of the SEC are $260.6 million.  Year-end 2011 proved
reserve were 5,654 MBO and 45.5 Bcf or 79.5 Bcfe.  PV @ 10% value of these
reserves at year-end 2011 using the same methodology as above was $249.9
million.  On a Bcfe basis reserves increased 13.3%.  The majority of the
increase occurred in our Leeville field where approximately 20 Proved
undeveloped locations were identified using new 3-D seismic data.  As
described below the Company has initiated a multi well program to develop
these PUD reserves.

2013 Operations Summary YTD and Capital Program

Operations Update

At our Garden Island Bay field we completed the following four capital
projects designed to increase production: recompletion of the SL 214 #915 into
the G-1 A and G-2 sands; cased hole evaluation of the SL 214 #916 well;
pipeline installation at the SL 214 #145 well; and, tubing replacement and
recompletion of the SL 214 #551 well.  Although the SL 214 #916 well was
unproductive, the other projects were all successful and are currently
yielding new production of 300-400 BOPD net to the Company.  Since initiating
a drilling program in the Leeville filed late in 2012, we have, to date, run
casing for future production on the following new wells: the Heirs of Abraham,
the LeFort #1, the LL&E #344 ST #1 and the LL&E #342.  Completion operations
and facilities construction are underway in all these projects with production
anticipated to commence late in the first quarter or early in the second
quarter.  The Heirs of Abraham well is planned as a single completion in the
NF 96 sand at 11,212 feet; the LeFort #1 is anticipated to be a dual
completion in the 95E and NF 96 sands at 10,500 and 10,700 feet respectively. 
The LL&E # 342 is anticipated to be a dual completion in the 192 sand and the
163 sand at 5,400 feet and 5,700 feet respectively, and the LL&E #344 ST #1 is
anticipated to be a single completion in the NF 96 sand at 10,250 feet.  These
six completions from the four well bores are all anticipated to be oil
producing with rates net to the Company's 40% interest expected to flow in the
range of 50-100 Boe/day each.  The original hole of the #344 found
noncommercial pay and was instead sidetracked to become the successful LL&E
344 ST #1.  Currently drilling are the LL&E #340 ST #1, which is targeting the
95 sand at 8,500 feet, and the SL 20783 # 1 exploratory which expects to reach
the Cib. Carst. sands at approximately 20,000 feet.

2013 Capital Budget

The Board of Directors approved a capital budget of $64 million for 2013. 
This budget will accommodate the drilling program in our Leeville, Garden
Island Bay and Chocolate Bayou fields in the first half of the year, as well
as projects in other fields within our portfolio during the latter part of the
year.  The budget assumes we will receive the additional $20 million of new
equity from our major shareholders under the $50 million equity financing
announced in December of 2012.  Further, it assumes increased availability
under our $200 million revolving credit facility at the mid-year
redetermination.  The current availability is $50 million.

James A. Watt, President and CEO of the Company, stated, "Initial work at our
Garden Island Bay field has successfully increased production and drilling
results to date are very encouraging in our Leeville field with production to
commence soon.  This increased production and resultant cash flow will fund
our planned drilling operations for the remainder of the year."  

Click here for more information: 
http://www.duneenergy.com/news.html?b=1683&1=1

FORWARD-LOOKING STATEMENTS: This document includes forward-looking statements.
Forward-looking statements include, but are not limited to, statements
concerning estimates of expected drilling and development wells and associated
costs, statements relating to estimates of, and increases in, production, cash
flows and values, statements relating to the continued advancement of Dune
Energy, Inc.'s projects and other statements which are not historical facts.
When used in this document, the words such as "could," "plan," "estimate,"
"expect," "intend," "may," "potential," "should," and similar expressions are
forward-looking statements. Although Dune Energy, Inc. believes that its
expectations reflected in these forward-looking statements are reasonable,
such statements involve risks and uncertainties and no assurance can be given
that actual results will be consistent with these forward-looking statements.
Important factors that could cause actual results to differ from these
forward-looking statements include the potential that the Company's projects
will experience technological and mechanical problems, geological conditions
in the reservoir may not result in commercial levels of oil and gas
production, changes in product prices and other risks disclosed in Dune's
Annual report on Form 10-K filed with the U.S. Securities and Exchange
Commission.

CONTACT: Investors, Steven J. Craig, Sr. Vice President Investor Relations and
Administration, Dune Energy, Inc., +1-713-229-6300

 

 

 

 Dune Energy, Inc. 
 Consolidated Balance Sheets 
                                    Successor
                                    December 31,
                                    2012                  2011
 ASSETS 
 Current assets: 
    Cash                            $        22,793,916   $        20,393,672
    Restricted cash                 -                     17,184
    Accounts receivable             6,723,233             8,107,009
    Current derivative asset        765,992               -
    Prepayments and other current   5,160,533             2,556,373
assets 
 Total current assets               35,443,674            31,074,238
 Oil and gas properties, using
successful efforts accounting -     239,233,653           210,199,348
proved 
 Less accumulated depreciation,     (13,806,672)          -
depletion and amortization 
 Net oil and gas properties         225,426,981           210,199,348
 Property and equipment, net of
accumulated depreciation of         71,080                230,074
$256,380 and $ - 
 Deferred financing costs, net of
accumulated amortization of         2,428,453             2,915,229
$771,061 and $19,449 
 Noncurrent derivative asset        397,886               -
 Other assets                       2,692,797             3,006,564
                                    5,590,216             6,151,867
 TOTAL ASSETS                       $      266,460,871    $      247,425,453
 LIABILITIES AND STOCKHOLDERS'
EQUITY 
 Current liabilities: 
    Accounts payable                $          6,987,857  $          6,759,073
    Accrued liabilities             12,529,899            10,042,683
    Current maturities of           1,623,541             4,557,857
long-term debt
 Total current liabilities          21,141,297            21,359,613
 Long-term debt                     83,429,862            88,503,991
 Other long-term liabilities        13,860,597            12,630,676
 Total liabilities                  118,431,756           122,494,280
 Commitments and contingencies      -                     -
 STOCKHOLDERS' EQUITY 
 Preferred stock, $.001 par value,
1,000,000 shares authorized,  
    250,000 shares undesignated,    -                     -
no shares issued and outstanding 
 Common stock, $.001 par value,
4,200,000,000 shares authorized,  
    59,022,445 and 38,579,630       59,022                38,580
shares issued 
 Treasury stock, at cost (1,056     (1,914)               (552)
and 235 shares) 
 Additional paid-in capital         155,824,868           124,893,145
 Accumulated deficit                (7,852,861)           -
 Total stockholders' equity         148,029,115           124,931,173
 TOTAL LIABILITIES AND              $      266,460,871    $      247,425,453
STOCKHOLDERS' EQUITY 

 

 Dune Energy, Inc. 
 Consolidated Statements of Operations 
                                     Successor             Predecessor 
                                     Company               Company 
                                    For the Year ended December 31, 
                                    2012                  2011
 Oil and gas revenues               $      51,968,654     $         62,891,627
 Other revenues                     173,250               -
 Total revenues                     52,141,904            62,891,627
 Operating expenses: 
    Lease operating expense and     25,960,588            26,084,239
production taxes 
    Accretion of asset retirement   1,461,756             1,317,516
obligation  
    Depletion, depreciation and     14,063,052            22,076,347
amortization 
    General and administrative      10,390,043            9,602,222
expense 
    Impairment of oil and gas       -                     18,087,128
properties 
    Exploration expense             -                     6,119,943
    Loss on settlement of asset     1,657,999             497,647
retirement obligation liability 
 Total operating expense            53,533,438            83,785,042
 Operating loss                     (1,391,534)           (20,893,415)
 Other income (expense): 
    Other income                    828,151               45,156
    Interest expense                (9,765,239)           (39,566,366)
    Gain on derivative              2,475,761             -
instruments 
 Total other income (expense)       (6,461,327)           (39,521,210)
 Net loss                           (7,852,861)           (60,414,625)
 Preferred stock dividend           -                     (20,212,916)
 Net loss available to common       $       (7,852,861)   $       (80,627,541)
shareholders 
 Net loss per share: 
    Basic and diluted               $                     $            
                                     (0.20)                (166.79)
 Weighted average shares
outstanding: 
    Basic and diluted               40,027,622            483,413

 

 

 Dune Energy, Inc. 
 Consolidated Statements of Cash Flows 
                                     Successor            Predecessor 
                                     Company              Company 
                                    For the Year ended December 31, 
                                    2012                 2011
 CASH FLOWS FROM OPERATING
ACTIVITIES 
 Net loss                           $      (7,852,861)   $    (60,414,625)
 Adjustments to reconcile net loss
to net cash used in 
    operating activities: 
    Depletion, depreciation and     14,063,052           22,076,347
amortization 
    Amortization of deferred        751,612              3,833,870
financing costs and debt discount 
    Stock-based compensation        1,721,531            506,210
    Accretion of asset retirement   1,461,756            1,317,516
obligation 
    Loss on settlement of asset     1,657,999            497,647
retirement obligation liability 
    Unrealized gain on derivative   (1,163,878)          -
instruments 
    Impairment of oil and gas       -                    18,087,128
properties 
    Changes in: 
       Accounts receivable          1,382,414            1,743,725
       Prepayments and other        (2,604,160)          (13,425)
assets 
       Payments made to settle      (3,590,824)          (743,611)
asset retirement obligations 
       Accounts payable and         3,099,902            14,412,362
accrued liabilities 
 NET CASH PROVIDED BY OPERATING     8,926,543            1,303,144
ACTIVITIES 
 CASH FLOWS FROM INVESTING
ACTIVITIES 
 Investment in proved and unproved  (21,791,346)         (18,302,410)
properties 
 Decrease in restricted cash        17,184               15,736,258
 Purchase of furniture and          (97,386)             (85,004)
fixtures 
 Decrease in other assets           313,767              705,682
 NET CASH USED IN INVESTING         (21,557,781)         (1,945,474)
ACTIVITIES 
 CASH FLOWS FROM FINANCING
ACTIVITIES 
 Proceeds from short-term debt      2,087,410            2,018,387
 Proceeds from long-term debt       12,000,000           -
 Proceeds from sale of common       30,000,000           -
stock 
 Increase in long-term debt         (198,924)            (3,098,232)
issuance costs 
 Increase in common stock issuance  (835,278)            -
costs 
 Payments on short-term debt        (5,021,726)          (1,869,448)
 Payments on long-term debt         (23,000,000)         -
 NET CASH PROVIDED BY (USED IN)     15,031,482           (2,949,293)
FINANCING ACTIVITIES 
 NET CHANGE IN CASH BALANCE         2,400,244            (3,591,623)
    Cash balance at beginning of    20,393,672           23,670,192
period 
    Cash balance at end of period   $      22,793,916    $      20,078,569
 SUPPLEMENTAL DISCLOSURES 
 Interest paid                      $        2,923,566   $      20,734,335
 Income taxes paid                  -                    -
 NON-CASH INVESTING AND FINANCIAL
DISCLOSURES 
 Accrued interest converted to      $        5,925,871   $                    
long-term debt                                            -
 Non-cash investment in proved and
unproved properties in accounts     5,541,969            -
payable 
 Revisions to asset retirement      1,700,990            -
obligations 
 Redeemable convertible preferred   -                    17,852,000
stock dividends  
 Accretion of discount on           -                    2,360,916
preferred stock 
 Common stock issued for            -                    62,288,000
conversion of preferred stock 

   

Dune Energy, Inc.
Consolidated Statements of Changes in Stockholders' Equity (Deficit)
Years ended December 31, 2012 and 2011
                                                     Additional                    Total
              Common Stock        Treasury Stock     Paid-In        Accumulated    Stockholders'
              Shares      Amount  Shares   Amount    Capital        Deficit        Equity
                                                                                   (Deficit)
Balance at                $                $         $              $              $
December 31,  419,127      419    (1,284)  (62,920)  81,082,184     (358,270,640)  (277,250,957)
2010
Conversion
of preferred  71,186      71                         62,287,929                    62,288,000
stock
Purchase of
treasury                          (1,146)  (12,115)                                (12,115)
stock
Restricted                                                                         -
stock issued
Restricted
stock         (1,124)     (1)                        1                             -
cancelled
Stock-based                                          506,210                       506,210
compensation
Preferred
stock                                                (17,852,000)                  (17,852,000)
dividends
Accretion of
discount on                                          (2,360,916)                   (2,360,916)
preferred
stock
Net loss                                                            (60,414,625)   (60,414,625)
Equity
adjustment    (489,189)   (489)   2,430    75,035    (123,663,408)  418,685,265    295,096,403
due to debt
restructure
                          $                $         $              $              $            
              -                   -             -           -               -              -
                          -
Successor
Company:
Purchase of
treasury                          (235)    (552)                                   (552)
stock
Equity
adjustment    38,579,630  38,580                     124,893,145                   124,931,725
due to debt
restructure
Balance at                $                $                        $              $
December 31,  38,579,630  38,580  (235)     (552)    $ 124,893,145          -       124,931,173
2011
Issuance of   18,749,997  18,750                     29,981,250                    30,000,000
common stock
Purchase of
treasury                          (821)    (1,362)                                 (1,362)
stock
Restricted    1,716,433   1,716                      (1,716)                       -
stock issued
Restricted
stock         (23,615)    (24)                       24                            -
cancelled
Stock-based                                          1,721,531                     1,721,531
compensation
Common stock
issuance                                             (835,278)                     (835,278)
costs
Long-term
debt                                                 65,912                        65,912
issuance
costs
Net loss                                                            (7,852,861)    (7,852,861)
Balance at                $                $                        $              $
December 31,  59,022,445  59,022  (1,056)  (1,914)   $ 155,824,868  (7,852,861)     148,029,115
2012

 

SOURCE Dune Energy, Inc.

Website: http://www.duneenergy.com
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