GeoMet Announces Financial and Operating Results for the Quarter and Year Ended December 31, 2013

GeoMet Announces Financial and Operating Results for the Quarter and Year Ended 
December 31, 2013 
HOUSTON, TX -- (Marketwired) -- 04/01/14 --  GeoMet, Inc. (OTCQB:
GMET) (NASDAQ: GMETP) ("GeoMet" or the "Company") today announced its
financial and operating results for the quarter and year ended
December 31, 2013. 
Financial and Operating Results  
On June 14, 2013, the Company closed the sale of all of its coal bed
methane properties located in the state of Alabama (the "Asset
Sale"). The Asset Sale resulted in a $36.9 million gain. The
properties sold represented approximately 29% of GeoMet's total
production. As such, the current year results are not comparable to
the prior year as presented below. 
Fourth Quarter 2013 Financial and Operating Results 
For the quarter ended December 31, 2013, GeoMet reported a net loss
of $2.1 million. Included in the net loss was a $1.1 million loss on
natural gas derivatives. For the quarter ended December 31, 2012,
GeoMet reported a net loss of $8.7 million. Included in the net loss
was a $12.3 million impairment to the Company's gas properties and a
$0.8 million asset impairment, offset by a $4.1 million gain on
natural gas derivatives.  
For the quarter ended December 31, 2013, GeoMet reported net loss
available to common stockholders of $4.3 million, or $0.11 per fully
diluted share. Included in net income available to common
stockholders for the quarter ended December 31, 2013 were non-cash
charges of $0.6 million for accretion of preferred stock and $1.6
million for paid-in-kind ("PIK") dividends paid on preferred stock.
For the quarter ended December 31, 2012, GeoMet reported a net loss
available to common stockholders of $10.4 million, or $0.26 per fully
diluted share. Included in the net loss available to common
stockholders for the quarter ended December 31, 2012 were charges of
$0.5 million for accretion of preferred stock and $1.2 million for
PIK dividends on preferred stock.  
Revenues for the quarter ended December 31, 2013 were $7.8 million,
as compared to $11.7 million for the prior year quarter. The average
natural gas price for the quarter ended December 31, 2013 was $3.71
per Mcf as compared to the prior year quarter average of $3.50 per
Mcf. 
Average net gas sales volumes for the quarter ended December 31, 2013
were 22.7 MMcf per day, a 37% decrease from the same quarter in 2012
of which 29% resulted from the Asset Sale and 8% resulted from
decreased production related to our horizontal Pinnate wells in our
remaining properties. 
Year ended December 31, 2013 Financial and Operating Results 
For the year ended December 31, 2013, GeoMet reported net income of
$35.3 million. Included in net income was a $36.9 million
non-recurring gain on the sale of our Alabama properties offset by a
$1.8 million loss on natural gas derivatives. For the year ended
December 31, 2012, GeoMet reported a net loss of $150.0 million.
Included in the net loss was a $95.7 million impairment of gas
properties, a $44.0 million write off of our deferred tax asset, a
$1.4 million write off of debt issuance costs, a $1.1 million charge
for restructuring costs, a $0.8 million asset impairment and a $0.7
million loss on the 2012 disposal of our Canadian operations.  
For the year ended December 31, 2013, GeoMet reported net income
available to common stockholders of $27.8 million, or $0.42 per fully
diluted share. Included in net income available to common
stockholders for the year ended December 31, 2013 were non-cash
charges of $2.3 million for accretion of preferred stock and $5.3
million for PIK dividends paid on preferred stock. For the year ended
December 31, 2012, GeoMet reported a net loss available to common
stockholders of $155.8 million, or $3.88 per fully diluted share.
Included in the net loss available to common stockholders for the
year ended December 31, 2012 were charges of $1.9 million for
accretion of preferred stock and $3.9 million for PIK dividends on
preferred stock.  
Revenues for the year ended December 31, 2013 were $38.2 million, as
compared to $39.4 million for the prior year period. The average
natural gas price for the year ended December 31, 2013 was $3.74 per
Mcf as compared to the prior year period average of $2.83 per Mcf. 
Average net gas sales volumes for the year ended December 31, 2013
were 27.9 MMcf per day, a 26% decrease from the same period in 2012
of which 18% resulted from the Asset Sale and 8% resulted from
decreased production related to our horizontal Pinnate wells in our
remaining properties. 
Forward-Looking Statements Notice 
This press release contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
Except for statements of historical facts, all statements included in
the document, including those preceded by, followed by or that
otherwise include the words "believe," "expects," "anticipates,"
"intends," "estimates," "projects," "target," "goal," "plans,"
"objective," "should" or similar expressions or variations on such
words, are forward-looking statements. These forward-looking
statements are subject to certain risks, trends and uncertainties
that could cause actual results to differ materially from those
projected. Among those risks, trends and uncertainties are volatility
of future natural gas prices, our estimate of the sufficiency of our
existing capital sources, our ability to raise additional capital to
fund cash requirements for future operations, the uncertainties
involved in estimating quantities of proved natural gas reserves,
reductions in the borrowing base under our credit agreement made by
our lenders, the sale of all or substantially all of our assets, in
prospect development and property acquisitions and in projecting
future rates of production, the timing of development expenditures
and drilling of wells, and the operating hazards attendant to the oil
and gas business. In particular, careful consideration should be
given to cautionary statements made in the various reports the
Company has filed with the SEC. Additional information concerning
factors that could cause actual results to differ materially from
those in the forward-looking statements is contained from time to
time in the Company's SEC filings, which may be obtained by
contacting the Company or the SEC. These filings are also available
through the Company's web site at http://www.geometinc.com or through
the SEC's Electronic Data Gathering and Analysis Retrieval System
(EDGAR) at http://www.sec.gov. GeoMet undertakes no duty to update or
revise these forward-looking statements.  
About GeoMet, Inc. 
GeoMet, Inc. is engaged in the production of natural gas from coal
seams ("coalbed methane"). Our core area of operations is the Central
Appalachian Basin of Virginia and West Virginia. We also control
additional coalbed methane and oil and gas development rights,
principally in Virginia, and West Virginia. 


 
                                                                            
                                GEOMET, INC.                                
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS               
                  (In thousands, except per share amounts)                  
                                                                            
                                  Three Months Ended        Year Ended      
                                     December 31,          December 31,     
                                 --------------------  -------------------- 
                                    2013       2012       2013       2012   
                                                                            
Total revenues                   $   7,780  $  11,728  $  38,209  $  39,383 
Expenses:                                                                   
  Total production expenses          5,227      6,410     22,945     27,795 
  Depreciation, depletion and                                               
   amortization                        847      2,071      4,594     11,532 
  Impairment of gas properties                                              
   and other                            --     13,044         --     96,511 
  General and administrative         1,555      1,216      5,105      5,934 
  Losses (gains) on derivative                                              
   contracts                         1,051     (4,074)     1,811     (4,416)
                                 ---------  ---------  ---------  --------- 
Total operating expenses             8,680     18,667     34,455    137,356 
Gain on the sale of gas                                                     
 properties                             --         --     36,948         -- 
Operating (loss) income               (900)    (6,939)    40,702    (97,973)
Other income (expense):                                                     
Write off of debt issuance costs        --         --         --     (1,378)
Other expenses & interest, net      (1,221)    (1,768)    (5,358)    (5,823)
                                 ---------  ---------  ---------  --------- 
(Loss) income before income                                                 
 taxes from continuing                                                      
 operations                         (2,121)    (8,707)    35,344   (105,174)
Income tax expense                      (6)        (6)       (25)   (44,043)
                                 ---------  ---------  ---------  --------- 
(Loss) income from continuing                                               
 operations                         (2,127)    (8,713)    35,319   (149,217)
Discontinued operations, net of                                             
 tax                                    --        (14)        --       (736)
                                 ---------  ---------  ---------  --------- 
Net (loss) income                $  (2,127) $  (8,727) $  35,319  $(149,953)
                                 =========  =========  =========  ========= 
Accretion of Preferred Stock          (633)      (495)    (2,258)    (1,913)
Dividends on Preferred Stock        (1,576)    (1,171)    (5,298)    (3,937)
                                 ---------  ---------  ---------  --------- 
Net (loss) income available to                                              
 common stockholders             $  (4,336) $ (10,393) $  27,763  $(155,803)
                                 =========  =========  =========  ========= 
Net (loss) income per common                                                
 share:                                                                     
Basic                            $   (0.11) $   (0.26) $    0.69  $   (3.88)
                                 =========  =========  =========  ========= 
Diluted                          $   (0.11) $   (0.26) $    0.42  $   (3.88)
                                 =========  =========  =========  ========= 
Weighted average number of                                                  
 common shares:                                                             
Basic                               40,505     40,436     40,481     40,124 
                                 =========  =========  =========  ========= 
Diluted                             40,505     40,436     83,385     40,124 
                                 =========  =========  =========  ========= 
                                                                            
                                                                            
                                GEOMET, INC.                                
                   CONDENSED CONSOLIDATED BALANCE SHEETS                    
                               (In thousands)                               
                                                                            
                                                 December 31,  December 31, 
                                                     2013          2012     
                                                 ------------  ------------ 
                     ASSETS                                                 
                                                                            
Current Assets:                                                             
  Cash and cash equivalents                      $      8,108  $      7,234 
  Accounts receivable, net                              2,901         6,249 
  Derivative asset--natural gas contracts                  --         3,930 
  Other current assets                                    693         1,701 
                                                 ------------  ------------ 
Total current assets                                   11,702        19,114 
Property and equipment--net                            42,329        75,125 
Deferred income taxes                                      --         1,126 
Total other noncurrent assets                             769           961 
                                                 ------------  ------------ 
                                                                            
TOTAL ASSETS                                     $     54,800  $     96,326 
                                                 ============  ============ 
                                                                            
LIABILITIES, MEZZANINE AND STOCKHOLDERS' DEFICIT                            
                                                                            
Current Liabilities:                                                        
  Current portion of long-term debt              $     71,550  $     10,300 
  Deferred income taxes                                    --         1,126 
  Derivative liability--natural gas contracts             834           920 
  Other current liabilities                             8,537        11,427 
                                                 ------------  ------------ 
Total current liabilities                              80,921        23,773 
                                                 ------------  ------------ 
Long-term debt                                             --       129,000 
Asset retirement obligations                            8,915        13,235 
Derivative liability--natural gas contracts               710         1,636 
Other long-term accrued liabilities                       113           144 
                                                 ------------  ------------ 
TOTAL LIABILITIES                                      90,659       167,788 
                                                 ------------  ------------ 
Series A Convertible Redeemable Preferred Stock        43,405        35,852 
Total stockholders' deficit                           (79,264)     (107,314)
                                                 ------------  ------------ 
TOTAL LIABILITIES, MEZZANINE AND STOCKHOLDERS'                              
 DEFICIT                                         $     54,800  $     96,326 
                                                 ============  ============ 
                                                                            
                                                                            
                                GEOMET, INC.                                
              CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS               
                               (In thousands)                               
                                                                            
                                                            Year Ended      
                                                           December 31,     
                                                       -------------------- 
                                                          2013       2012   
                                                       ---------  --------- 
Net cash provided by operating activities              $   8,798  $  18,361 
Net cash provided by investing activities (1)             59,833      8,036 
Net cash used in financing activities (2)                (67,757)   (19,626)
Effect of exchange rates changes on cash                      --          5 
                                                       ---------  --------- 
                                                                            
Increase in cash and cash equivalents                        874      6,776 
Cash and cash equivalents at beginning of period           7,234        458 
                                                       ---------  --------- 
                                                                            
Cash and cash equivalents at end of period             $   8,108  $   7,234 
                                                       =========  ========= 
                                                                            
(1) Net cash provided by investing activities for the year ended December   
    31, 2013 primarily consisted of the net proceeds from the sale of       
    Properties in Alabama. Net cash provided by investing activities for the
    year ended December 31, 2012 primarily consisted of return of basis in  
    the settlement of natural gas derivative contracts acquired in a        
    November 2011 asset purchase.                                           
                                                                            
(2) Net cash used in financing activities for the year ended December 31,   
    2013 and 2012 primarily consisted of the net repayment of amounts       
    outstanding under the Credit Agreement.                                 
                                                                            
                                                                            
                                GEOMET, INC.                                
                            OPERATING STATISTICS                            
                   (in thousands, except per Mcf amounts)                   
                                                                            
                                      Three Months Ended      Year Ended    
                                         December 31,        December 31,   
                                     ------------------- -------------------
                                        2013      2012      2013      2012  
                                     --------- --------- --------- ---------
                                                                            
Gas sales                            $   7,762 $  11,682 $  38,087 $  39,147
Lease operating expenses             $   2,517 $   4,132 $  13,132 $  17,483
Compression and transportation                                              
 expenses                                2,231     1,592     7,716     8,349
Production taxes                           479       686     2,097     1,962
                                     --------- --------- --------- ---------
Total production expenses            $   5,227 $   6,410 $  22,945 $  27,794
                                                                            
Net sales volumes (Consolidated)                                            
 (MMcf)                                  2,091     3,340    10,179    13,808
  Pond Creek field (Central                                                 
   Appalachian Basin) (MMcf)             1,399     1,458     5,607     5,866
  Other Central Appalachian Basin                                           
   fields (MMcf)                           692       915     2,917     3,850
  Gurnee field (Cahaba Basin) (MMcf)        --       418       723     1,743
  Black Warrior Basin fields (MMcf)         --       549       932     2,349
                                                                            
Per Mcf data ($/Mcf):                                                       
                                                                            
Average natural gas sales price                                             
 realized (Consolidated)(1)          $    3.85 $    4.33 $    3.85 $    4.02
                                                                            
Average natural gas sales price                                             
 (Consolidated)                      $    3.71 $    3.50 $    3.74 $    2.83
  Pond Creek field (Central                                                 
   Appalachian Basin)                $    3.80 $    3.59 $    3.79 $    2.92
  Other Central Appalachian Basin                                           
   fields                            $    3.53 $    3.73 $    3.65 $    2.69
  Gurnee field (Cahaba Basin) (2)    $      -- $    3.47 $    3.77 $    2.83
  Black Warrior Basin fields (2)     $      -- $    3.46 $    3.73 $    2.86
                                                                            
Lease operating expenses                                                    
 (Consolidated)                      $    1.20 $    1.24 $    1.29 $    1.27
  Pond Creek field (Central                                                 
   Appalachian Basin)                $    1.11 $    1.01 $    1.12 $    1.06
  Other Central Appalachian Basin                                           
   fields                            $    1.37 $    1.81 $    1.40 $    1.36
  Gurnee field (Cahaba Basin) (2)    $      -- $    2.73 $    2.85 $    2.68
  Black Warrior Basin fields (2)     $      -- $    0.70 $    0.73 $    0.57
Compression and transportation                                              
 expenses (Consolidated)             $    1.07 $    0.47 $    0.75 $    0.60
  Pond Creek field (Central                                                 
   Appalachian Basin)                $    0.64 $    0.54 $    0.66 $    0.57
  Other Central Appalachian Basin                                           
   fields                            $    1.94 $    0.98 $    1.25 $    1.05
  Gurnee field (Cahaba Basin) (2)    $      -- $    0.23 $    0.28 $    0.26
  Black Warrior Basin fields (2)     $      -- $    0.20 $    0.19 $    0.19
Production taxes (Consolidated)      $    0.23 $    0.21 $    0.21 $    0.14
  Pond Creek field (Central                                                 
   Appalachian Basin)                $    0.22 $    0.19 $    0.21 $    0.16
  Other Central Appalachian Basin                                           
   fields                            $    0.24 $    0.16 $    0.20 $    0.11
  Gurnee field (Cahaba Basin) (2)    $      -- $    0.16 $    0.18 $    0.12
  Black Warrior Basin fields (2)     $      -- $    0.19 $    0.21 $    0.17
Total production expenses                                                   
 (Consolidated)                      $    2.50 $    1.92 $    2.25 $    2.01
  Pond Creek field (Central                                                 
   Appalachian Basin)                $    1.97 $    1.74 $    1.99 $    1.79
  Other Central Appalachian Basin                                           
   fields                            $    3.55 $    2.95 $    2.85 $    2.52
  Gurnee field (Cahaba Basin) (2)    $      -- $    3.12 $    3.31 $    3.06
  Black Warrior Basin fields (2)     $      -- $    1.09 $    1.13 $    0.93
Depletion (Consolidated)             $    0.39 $    0.59 $    0.44 $    0.81

 
(1) Average natural gas sales price realized includes the effects of
realized gains and losses on derivative contracts. 
 (2) On June 14,
2013, the Company closed the sale of all of its coal bed methane
properties located in the state of Alabama.  


 
                                                                        
                                GEOMET, INC.                            
                 CONSOLIDATED DERIVATIVE CONTRACT POSITIONS             
                                                                        
   At December 31, 2013, we had the following natural gas swap position:
                                                                        
                                                 Volume        Average  
   Period                                        (MMBtu)         Price  
   ---------------------------------------- ---------------- -----------
   First Quarter of 2014                         360,000     $      3.82
                                                                        
                                                                        
 At December 31, 2013, we had the following natural gas collar positions:  
                                                                           
                                              Volume       Sold     Bought 
 Period                                      (MMBtu)     Ceiling    Floor  
 ---------------------------------------- ------------- --------- ---------
 January 2014 through December 2015         3,650,000   $    4.30 $    3.60
 January 2014 through December 2015         3,650,000   $    4.20 $    3.50
                                          -------------                    
                                            7,300,000                      
                                          =============                    

  
For more information please contact:
Stephen M. Smith 
(713) 287-2251 
ssmith@geometcbm.com
www.geometinc.com 
 
 
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