Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Sep. 30, 2014 | Nov. 14, 2014 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'RED MOUNTAIN RESOURCES, INC. | ' |
Entity Central Index Key | '0001483496 | ' |
Current Fiscal Year End Date | '--06-30 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Trading Symbol | 'rdmp | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Wel Known Seasoned Issuer | 'No | ' |
Entity Voluntary Filers | 'No | ' |
Entity Common Stock, Shares Outstanding | ' | 14,857,488 |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Document Fiscal Year Focus | '2015 | ' |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Current Assets: | ' | ' |
Cash and cash equivalents | $1,000 | $1,682 |
Accounts receivable - oil and natural gas sales | 2,772 | 3,186 |
Accounts receivable - joint interest | 764 | 1,645 |
Prepaid expenses and other current assets | 551 | 527 |
Commodities derivative asset - current | 189 | 37 |
Deferred tax asset - current | 277 | 368 |
Total current assets | 5,553 | 7,445 |
Long-Term Investments: | ' | ' |
Debentures - held to maturity | 4,820 | 4,820 |
Oil and Natural Gas Properties, Successful Efforts Method: | ' | ' |
Proved properties | 85,146 | 82,362 |
Unproved properties | 19,043 | 19,109 |
Other property and equipment | 1,139 | 1,196 |
Less accumulated depreciation, depletion, amortization and impairment | -21,977 | -19,497 |
Oil and natural gas properties, net | 83,351 | 83,170 |
Other Assets: | ' | ' |
Restricted cash, long-term | 493 | 493 |
Debt issuance costs, net of current portion | 975 | 1,101 |
Security deposit and other assets | 181 | 197 |
Total Assets | 95,373 | 97,226 |
Current Liabilities: | ' | ' |
Accounts payable | 4,467 | 3,536 |
Revenues payable | 1,154 | 1,673 |
Accrued expenses | 2,605 | 2,035 |
Commodities derivative liability | ' | 121 |
Dividend payable | 175 | 179 |
Taxes payable | 3 | ' |
Asset retirement obligation - current | 178 | 214 |
Environmental remediation liability- current | 2,057 | 2,067 |
Line of credit, net of current portion | 26,800 | ' |
Total current liabilities | 37,439 | 9,825 |
Long-Term Liabilities: | ' | ' |
Mandatorily redeemable preferred stock, net of discount of $1,464 and $1,561 | 4,898 | 4,801 |
Line of credit, net of current portion | ' | 26,800 |
Deferred tax liability - long-term | 330 | 409 |
Asset retirement obligation, net of current portion | 5,570 | 5,531 |
Total long-term liabilities | 10,798 | 37,541 |
Total Liabilities | 48,237 | 47,366 |
Commitments and Contingencies (Note 10) | ' | ' |
Stockholders' Equity: | ' | ' |
Common stock, $0.00001 par value; 50,000 shares authorized; 14,857 shares issued and 14,790 shares outstanding as of September 30, 2014 and June 30, 2014 | 1 | 1 |
Noncontrolling interest | 6,244 | 6,076 |
Additional paid-in capital | 78,105 | 78,105 |
Accumulated deficit | -37,214 | -34,322 |
Total stockholders' equity | 47,136 | 49,860 |
Total Liabilities and Stockholders' Equity | $95,373 | $97,226 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
In Thousands, except Per Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Discount on mandatorily redeemable preferred stock | $1,464 | $1,564 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, authorized shares | 1,200,000 | 1,200,000 |
Preferred stock, issued shares | 476,687 | ' |
Preferred stock, outstanding shares | 354,463 | ' |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, authorized shares | 50,000 | 50,000 |
Common stock, issued shares | 14,857 | 14,857 |
Common stock, outstanding shares | 14,790 | 14,790 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Revenue: | ' | ' |
Oil and natural gas sales | $5,272 | $5,774 |
Operating Expenses: | ' | ' |
Exploration expense | 250 | 101 |
Dry hole expense | 533 | ' |
Production taxes | 419 | 606 |
Lease operating expenses | 1,156 | 747 |
Natural gas transportation and marketing expenses | 98 | 38 |
Depreciation, depletion, amortization and impairment | 2,409 | 2,091 |
Accretion of discount on asset retirement obligation | 34 | 67 |
General and administrative expense | 2,689 | 1,942 |
Total operating expenses | 7,588 | 5,592 |
Income (Loss) from Operations | -2,316 | 182 |
Other Income (Expense): | ' | ' |
Interest expense | -665 | -927 |
Gain (loss) on commodity derivatives | 269 | -384 |
Total Other Expense | -396 | -1,311 |
Loss Before Income Taxes | -2,712 | -1,129 |
Income tax provision | -12 | ' |
Net loss | -2,724 | -1,129 |
Net income (loss) attributable to non-controlling interest | 168 | 146 |
Net loss attributable to Red Mountain Resources, Inc | ($2,892) | ($1,275) |
Basic and diluted net loss per common share (in dollars per share) | ($0.19) | ($0.10) |
Basic and diluted weighted average common shares outstanding (in shares) | 14,857 | 12,922 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Cash Flow From Operating Activities: | ' | ' |
Net loss | ($2,724) | ($1,129) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ' | ' |
Deferred income tax expense | 12 | ' |
Depreciation, depletion, amortization and impairment | 2,409 | 2,091 |
Amortization of debt issuance costs | 223 | 510 |
Accretion of discount on asset retirement obligation | 34 | 67 |
Dividend accrued for mandatorily redeemable preferred stock | -4 | 149 |
Change in commodity derivatives | -273 | 382 |
Change in working capital: | ' | ' |
Accounts receivable - oil and natural gas sales | 414 | 883 |
Accounts receivable - other | 881 | 1,254 |
Prepaid expenses and other current assets | -6 | 687 |
Accounts payable | 411 | -4,733 |
Accrued expenses | 561 | -543 |
Net cash provided by (used in) operating activities | 1,938 | -382 |
Cash Flow From Investing Activities: | ' | ' |
Additions to oil and natural gas properties | -2,561 | -1,494 |
Additions to other property and equipment | -23 | -71 |
Settlement of asset retirement obligations | -36 | ' |
Net cash used in investing activities | -2,620 | -1,565 |
Cash Flow From Financing Activities: | ' | ' |
Proceeds from issuance of common shares, net of issuance costs | ' | 3,605 |
Proceeds from issuance of preferred stock, net of issuance costs | ' | 7,095 |
Payments on line of credit | ' | -5,000 |
Payments on notes payable | ' | -500 |
Net cash provided by financing activities | ' | 5,200 |
Net change in cash and equivalents | -682 | 3,253 |
Cash at beginning of period | 1,682 | 456 |
Cash at end of period | 1,000 | 3,709 |
Supplemental Disclosure of Cash Flow Information | ' | ' |
Cash paid during the period for interest | 446 | 536 |
Non-Cash Transactions | ' | ' |
Change in asset retirement obligation estimate | 5 | 22 |
Issuance of warrants with preferred stock | ' | $2,395 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) (USD $) | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Noncontrolling Interest [Member] | Total |
In Thousands | |||||
Balance, beginning at Jun. 30, 2014 | $1,487 | $78,105 | ($34,322) | $6,076 | $49,860 |
Balance, beginning, shares at Jun. 30, 2014 | 14,857 | ' | ' | ' | 14,857 |
Net income (loss) | ' | ' | -2,892 | 168 | -2,724 |
Balance, ending at Sep. 30, 2014 | $1,487 | $78,105 | ($37,214) | $6,244 | $47,136 |
Balance, ending, shares at Sep. 30, 2014 | 14,857 | ' | ' | ' | 14,857 |
Organization
Organization | 3 Months Ended |
Sep. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Organization | ' |
1. Organization | |
Red Mountain Resources, Inc. is a Texas corporation formed on January 23, 2014. On January 31, 2014, the Company changed its state of incorporation from the State of Florida to the State of Texas by merging Red Mountain Resources, Inc., a Florida corporation (“RMR FL”), with and into Red Mountain Resources, Inc., a Texas corporation. Unless the context otherwise requires, the terms “Red Mountain” and “Company” refer to Red Mountain Resources, Inc. and its consolidated subsidiaries. | |
The Company is a Dallas-based growth-oriented energy company engaged in the acquisition, development and exploration of oil and natural gas properties in established basins with demonstrable prolific producing zones. Currently, the Company has established acreage positions and production in the Permian Basin of West Texas and Southeast New Mexico and the onshore Gulf Coast of Texas. Additionally, the Company has an established and growing acreage position in Kansas. | |
Reverse stock split | |
On January 31, 2014, RMR FL effected a reverse stock split of RMR FL’s common stock, par value $0.00001 per share (“RMR FL Common Stock”), at an exchange ratio of 1-for-10 (the “Reverse Stock Split”), together with a proportional reduction in the number of authorized shares of RMR FL Common Stock from 500.0 million shares to 50.0 million shares. The par value of RMR FL Common Stock did not change as a result of the Reverse Stock Split. As of January 31, 2014, every ten shares of RMR FL Common Stock were combined into one share of RMR FL Common Stock, reducing the number of outstanding shares of RMR FL Common Stock from approximately 134.0 million to approximately 13.4 million. In addition, a proportionate adjustment was made to the per share exercise price and the number of shares issuable upon the exercise of all outstanding warrants to purchase shares of RMR FL Common Stock. All share and per share amounts and calculations have been retroactively adjusted to reflect the effects of the Reverse Stock Split. |
Going_Concern
Going Concern | 3 Months Ended |
Sep. 30, 2014 | |
Going Concern | ' |
Going Concern | ' |
2. Going Concern | |
These consolidated financial statements have been prepared on the basis of accounting principles applicable to a going concern. These principles assume that the Company will be able to realize its assets and discharge its obligations in the normal course of operations for the foreseeable future. | |
The Company incurred a net loss of $2.9 million during the three months ended September 30, 2014. At September 30, 2014, the outstanding principal amount of the Company’s debt was $31.7 million, net of an aggregate discount of $1.5 million, and the Company had a working capital deficit of $31.9 million. Of the outstanding debt, $26.8 million is outstanding under the Company’s Credit Facility (as defined below). Of the $31.9 million working capital deficit at September 30, 2014, $26.8 million relates to the reclassification of the full amount of the outstanding borrowings under the Company's Credit Facility from a long-term liability to a short-term liability on its Consolidated Balance Sheets as of September 30, 2014. The Company is currently in default under the Credit Facility, and the lender has the right to accelerate all amounts outstanding under the Credit Facility upon notice to the borrowers. The Company is in discussions with the lender regarding either a waiver of the non-compliance or an amendment to the credit agreement to cure the non-compliance. While the Company anticipates obtaining a waiver from the lender, it cannot provide any assurance that these negotiations will be successful. The Company is exploring available financing options, including the sale of debt or equity. If the Company is unable to finance its operations on acceptable terms or at all, its business, financial condition and results of operations may be materially and adversely affected. As a result of recurring losses from operations and a working capital deficiency, there is substantial doubt regarding the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amount and classification of liabilities that may result from the possible inability of the Company to continue as a going concern. |
Significant_Accounting_Policie
Significant Accounting Policies | 3 Months Ended |
Sep. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Significant Accounting Policies | ' |
3. Significant Accounting Policies | |
Basis of Presentation | |
The condensed consolidated financial statements include the accounts of Red Mountain Resources, Inc. and its subsidiaries. The condensed consolidated financial statements and related footnotes are presented in accordance with generally accepted accounting principles in the United States (“GAAP”). | |
The Company has prepared the accompanying unaudited interim financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”), and in the opinion of management, such financial statements reflect all adjustments necessary to present fairly the consolidated financial position of the Company at September 30, 2014 and June 30, 2014 and its results of operations and cash flows for the periods presented. The Company has omitted certain information and disclosures normally included in annual financial statements prepared in accordance with GAAP pursuant to those rules and regulations, although the Company believes that the disclosures it has made are adequate to make the information presented not misleading. These unaudited interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related footnotes included in its most recent Annual Report on Form 10-K. | |
In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect reported amounts in the financial statements and disclosures. The results of operations for the interim periods are not necessarily indicative of the results the Company expects for the full fiscal year. The Company has not made any changes in its significant accounting policies from those disclosed in its most recent Annual Report on Form 10-K. | |
Noncontrolling Interests | |
Subsequent to January 28, 2013, the Company accounts for the noncontrolling interest in Cross Border Resources, Inc. (“Cross Border”) in accordance with ASC Topic 810, Consolidation (“ASC 810”). ASC 810 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to the noncontrolling interest, changes in a parent’s ownership interest and the valuation of retained noncontrolling equity investments when a subsidiary is deconsolidated. ASC 810 also establishes reporting requirements that provide sufficient disclosures that clearly identify and distinguish between the interest of the parent and the interests of the noncontrolling owner. In addition, this guidance provides for increases and decreases in the Company’s controlling financial interests in consolidated subsidiaries to be reported in equity similar to treasury stock transactions. | |
Debentures - Held to Maturity | |
The Company’s investments in non-performing debentures were initially recorded at cost which the Company believes was fair value. Management estimated cash flows expected to be collected considering the contractual terms of the loans, the nature and estimated fair value of collateral, and other factors it deemed appropriate. The estimated fair value of the loans at acquisition was significantly less than the contractual amounts due under the terms of the loan agreements. | |
Since, at the acquisition date, the Company expected to collect less than the contractual amounts due under the terms of the loans based, at least in part, on the assessment of the credit quality of the borrower, the loans are accounted for in accordance with ASC Topic 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality (“ASC 310-30”). The difference between the contractually required payments on the loans as of the acquisition date and the total cash flows expected to be collected, or non-accretable difference, is not recognized and totaled $2.1 million and $2.1 million, plus accrued interest in arrears as of September 30, 2014 and June 30, 2014, respectively. | |
Debentures are classified as non-accrual when management is unable to reasonably estimate the timing or amount of cash flows expected to be collected from the debentures or has serious doubts about further collectability of principal or interest. As of September 30, 2014 and June 30, 2014, all of the Company’s debentures were on non-accrual status since the borrower remains under the supervision of the bankruptcy court. | |
The Company periodically re-evaluates cash flows expected to be collected for each debenture based upon all available information as of the measurement date. Subsequent increases in cash flows expected to be collected are recognized prospectively through an adjustment to the debenture’s yield over its remaining life, which may result in a reclassification from non-accretable difference to accretable yield. Subsequent decreases in cash flows expected to be collected are evaluated to determine whether a provision for loan loss should be established. If decreases in expected cash flows result in a decrease in the estimated fair value of the debenture below its amortized cost, the debenture is deemed to be impaired and the Company will record a provision for impairment to write the debenture down to its estimated fair value. The Company did not record an impairment during the three months ended September 30, 2014. | |
The Company’s investments in non-performing debentures are classified as held to maturity because the Company has the intent and ability to hold them until maturity. | |
Recent Accounting Pronouncements | |
In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”), which requires management to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter, and early adoption is permitted. The Company is currently in the process of evaluating the impact the adoption of ASU 2014-15 will have on the Company’s consolidated financial statements. |
Oil_and_Natural_Gas_Properties
Oil and Natural Gas Properties and Other Property and Equipment | 3 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Oil and Gas Property [Abstract] | ' | ||||||||
Oil and Natural Gas Properties and Other Property and Equipment | ' | ||||||||
4. Oil and Natural Gas Properties and Other Property and Equipment | |||||||||
Oil and Natural Gas Properties | |||||||||
The following table sets forth the capitalized costs under the successful efforts method for oil and natural gas properties: | |||||||||
September 30, | June 30, | ||||||||
2014 | 2014 | ||||||||
(in thousands) | |||||||||
Oil and natural gas properties: | |||||||||
Proved | $ | 85,146 | $ | 82,362 | |||||
Unproved | 19,043 | 19,109 | |||||||
Total oil and natural gas properties | 104,189 | 101,471 | |||||||
Less accumulated depletion and impairment | (21,456 | ) | (19,138 | ) | |||||
Net oil and natural gas properties capitalized costs | $ | 82,733 | $ | 82,333 | |||||
At September 30, 2014 and June 30, 2014, the capitalized costs of the Company’s oil and natural gas properties included (i) $38.8 million and $39.0 million, respectively, relating to acquisition costs of proved properties which are being amortized by the unit-of-production method using total proved reserves and (ii) $45.8 million and $39.6 million, respectively, relating to exploratory well costs and additional development costs which are being amortized by the unit-of-production method using proved developed reserves. | |||||||||
During the three months ended September 30, 2014 and 2013, the Company incurred $0.5 million and $0 million in exploratory drilling costs. The Company transferred $30,000 and $0 of exploratory well costs to proved properties during the three months ended September 30, 2014 and 2013, respectively. | |||||||||
The Company recorded an impairment of approximately $36,000 related to its unproved oil and natural gas properties during the three months ended September 30, 2014. | |||||||||
Capitalized costs related to proved oil and natural gas properties, including wells and related equipment and facilities, are evaluated for impairment based on the Company’s analysis of undiscounted future net cash flows. If undiscounted future net cash flows are insufficient to recover the net capitalized costs related to proved properties, then the Company recognizes an impairment charge in income equal to the difference between the carrying value and the estimated fair value of the properties. Estimated fair values are determined using discounted cash flow models. The discounted cash flow models include management’s estimates of future oil and natural gas production, operating and development costs and discount rates. The Company did not record any impairment charges on its proved properties for the three months ended September 30, 2014 and 2013. | |||||||||
Other Property and Equipment | |||||||||
The historical cost of other property and equipment, presented on a gross basis with accumulated depreciation and amortization is summarized as follows: | |||||||||
September 30, | June 30, | ||||||||
2014 | 2014 | ||||||||
(in thousands) | |||||||||
Other property and equipment | $ | 1,139 | $ | 1,196 | |||||
Less accumulated depreciation and amortization | (521 | ) | (359 | ) | |||||
Net property and equipment | $ | 618 | $ | 837 | |||||
Asset_Retirement_Obligations
Asset Retirement Obligations | 3 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Asset Retirement Obligation Disclosure [Abstract] | ' | ||||||||
Asset Retirement Obligations | ' | ||||||||
5. Asset Retirement Obligations | |||||||||
The following table summarizes the changes in the Company’s asset retirement obligations (“AROs”) for the periods indicated: | |||||||||
Three Months Ended | Fiscal Year Ended | ||||||||
September 30, | June 30, | ||||||||
2014 | 2014 | ||||||||
(in thousands) | |||||||||
Asset retirement obligations at beginning of period | $ | 5,745 | $ | 5,020 | |||||
Liabilities incurred | 5 | 75 | |||||||
Liabilities settled | (36 | ) | (2 | ) | |||||
Accretion expense | 34 | 267 | |||||||
Revisions in estimated liabilities | — | 385 | |||||||
Asset retirement obligations at end of period | 5,748 | 5,745 | |||||||
Less: current portion | 178 | 214 | |||||||
Long-term portion | $ | 5,570 | $ | 5,531 | |||||
During the three months ended September 30, 2013, the Company recorded an upward revision to previous estimates for its ARO primarily due to changes in the estimated future cash outlays. | |||||||||
Derivatives
Derivatives | 3 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||
Derivatives | ' | ||||||||||
6. Derivatives | |||||||||||
At September 30, 2014, the Company had the following commodity derivatives positions outstanding: | |||||||||||
Commodity and Time Period | Contract | Volume Transacted | Contract Price | ||||||||
Type | |||||||||||
Crude Oil | |||||||||||
October 1, 2014―November 30, 2014 | Swap | 2,000 Bbls/month | $ | 93.50/Bbl | |||||||
October 1, 2014―December 31, 2014 | Put | 1,979-8,330 Bbls/month | $95.00 - $100.00/Bbl | ||||||||
October 1, 2014―January 31, 2015 | Put | 6,000 Bbls/month | $ | 95.00/Bbl | |||||||
The following table summarizes the fair value of the Company’s open commodity derivatives as of September 30, 2014 and June 30, 2014: | |||||||||||
Balance Sheet Location | Fair Values | ||||||||||
September 30, | June 30, | ||||||||||
2014 | 2014 | ||||||||||
(in thousands) | |||||||||||
Derivatives not designated as hedging instruments | |||||||||||
Commodity derivatives | Commodities derivative asset | $ | 189 | $ | 37 | ||||||
Commodity derivatives | Commodities derivative liability | $ | — | $ | (121 | ) | |||||
The following table summarizes the change in the fair value of the Company’s commodity derivatives: | |||||||||||
Income Statement Location | Three Months Ended | ||||||||||
September 30, | |||||||||||
2014 | 2013 | ||||||||||
(in thousands) | |||||||||||
Derivatives not designated as hedging instruments | |||||||||||
Commodity derivatives | Gain (loss) on commodity derivatives | $ | 269 | $ | (384 | ) | |||||
Unrealized gains and losses, at fair value, are included on the Company’s Consolidated Balance Sheets as current or non-current assets or liabilities based on the anticipated timing of cash settlements under the related contracts. Changes in the fair value of the Company’s commodity derivatives contracts are recorded in earnings as they occur and included in other income (expense) on the Company’s Consolidated Statements of Operations. The Company estimates the fair values of swap contracts based on the present value of the difference in exchange-quoted forward price curves and contractual settlement prices multiplied by notional quantities. The Company internally valued the option contracts using industry-standard option pricing models and observable market inputs. The Company uses its internal valuations to determine the fair values of the contracts that are reflected on its Consolidated Balance Sheets. Realized gains and losses are also included in other income (expense) on its Consolidated Statements of Operations. | |||||||||||
The Company is exposed to credit losses in the event of nonperformance by the counterparties on its commodity derivatives positions and has considered the exposure in its internal valuations. However, the Company does not anticipate nonperformance by the counterparties over the term of the commodity derivatives positions. | |||||||||||
In connection with the closing of the Senior First Lien Secured Credit Agreement (as amended, the “Credit Agreement”) with Cross Border, Black Rock Capital, Inc. (“Black Rock”) and RMR Operating, LLC (collectively with the Company, the “Borrowers”) and Independent Bank, as Lender (the “Lender”), the Company was required to enter into hedging agreements effectively hedging at least 50% of the oil volumes of the Company and its subsidiaries. At the same time, the Company entered into a Novation Agreement with BP Energy Company that transferred Cross Border’s then-existing swap agreements to the Company. Pursuant to an Inter-Borrower Agreement among the Borrowers, the Company allocates these swap agreements back to Cross Border and may allocate future hedging agreements related to Cross Border’s production to Cross Border. See ‘Note 8. Debt-Credit Facility.” |
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
7. Fair Value Measurements | |||||||||||||||||
Fair value measurements are based upon inputs that market participants use in pricing an asset or liability, which are classified into two categories: observable inputs and unobservable inputs. Observable inputs represent market data obtained from independent sources, whereas unobservable inputs reflect a company’s own market assumptions, which are used if observable inputs are not reasonably available without undue cost and effort. These two types of inputs are further prioritized into the following fair value input hierarchy: | |||||||||||||||||
● | Level 1 - quoted prices for identical assets or liabilities in active markets. | ||||||||||||||||
● | Level 2 - quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates) and inputs derived principally from or corroborated by observable market data by correlation or other means. | ||||||||||||||||
● | Level 3 - unobservable inputs for the asset or liability. | ||||||||||||||||
The fair value input hierarchy level to which an asset or liability measurement in its entirety falls is determined based on the lowest level input that is significant to the measurement in its entirety. | |||||||||||||||||
The following table summarizes the valuation of the Company’s financial assets and liabilities at September 30, 2014 and June 30, 2014: | |||||||||||||||||
Fair Value Measurements at Reporting Date Using | |||||||||||||||||
Quoted Prices in | Significant or | Significant | Fair Value at | ||||||||||||||
Active Markets for | Other Observable | Unobservable | 30-Sep-14 | ||||||||||||||
Identical Assets or | Inputs (Level 2) | Inputs (Level 3) | |||||||||||||||
Liabilities (Level 1) | |||||||||||||||||
(in thousands) | |||||||||||||||||
Assets: | |||||||||||||||||
Commodity derivatives | $ | — | $ | 189 | $ | — | $ | 189 | |||||||||
Oil and gas properties impairment (non-recurring) | — | — | (36 | ) | (36 | ) | |||||||||||
Total | $ | — | $ | 189 | $ | (36 | ) | $ | 153 | ||||||||
Liabilities: | |||||||||||||||||
Asset retirement obligations (non-recurring) | $ | — | $ | — | $ | (5,748 | ) | $ | (5,748 | ) | |||||||
Environmental remediation liability | — | — | (2,057 | ) | (2,057 | ) | |||||||||||
Total | $ | — | $ | — | $ | (7,805 | ) | $ | (7,805 | ) | |||||||
Fair Value Measurements at Reporting Date Using | |||||||||||||||||
Quoted Prices in | Significant or | Significant | Fair Value at | ||||||||||||||
Active Markets for | Other Observable | Unobservable | 30-Jun-14 | ||||||||||||||
Identical Assets or | Inputs (Level 2) | Inputs (Level 3) | |||||||||||||||
Liabilities (Level 1) | |||||||||||||||||
(in thousands) | |||||||||||||||||
Assets: | |||||||||||||||||
Commodity derivatives | $ | — | $ | 37 | $ | — | $ | 37 | |||||||||
Oil and gas properties impairment (non-recurring) | — | — | (487 | ) | (487 | ) | |||||||||||
Total | $ | — | $ | 37 | $ | (487 | ) | $ | (450 | ) | |||||||
Liabilities: | |||||||||||||||||
Asset retirement obligations (non-recurring) | $ | — | $ | — | $ | (5,745 | ) | $ | (5,745 | ) | |||||||
Commodities derivative liability | — | (121 | ) | — | (121 | ) | |||||||||||
Environmental remediation liability | — | — | (2,067 | ) | (2,067 | ) | |||||||||||
Total | $ | — | $ | (121 | ) | $ | (7,812 | ) | $ | (7,933 | ) | ||||||
The following is a summary of changes to fair value measurements using Level 3 inputs during the quarter ended September 30, 2014: | |||||||||||||||||
(in thousands) | Environmental | ||||||||||||||||
Liability | |||||||||||||||||
Balance, June 30, 2014 | $ | (2,067 | ) | ||||||||||||||
Settlement of liabilities | 10 | ||||||||||||||||
Balance, September 30, 2014 | $ | (2,057 | ) | ||||||||||||||
Debt
Debt | 3 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Debt | ' | ||||||||
8. Debt | |||||||||
As of the dates indicated, the Company’s debt consisted of the following: | |||||||||
September 30, | June 30, | ||||||||
2014 | 2014 | ||||||||
(in thousands) | |||||||||
Credit Facility | $ | 26,800 | $ | 26,800 | |||||
Mandatorily redeemable preferred stock and accrued dividends, net of discount of $1,464 and $1,561, respectively | 4,898 | 4,801 | |||||||
Total debt | 31,698 | 31,601 | |||||||
Less: short-term portion | 26,800 | — | |||||||
Long-term debt | $ | 4,898 | $ | 31,601 | |||||
Credit Facility | |||||||||
On February 5, 2013, the Company entered into the Credit Agreement with the Borrowers and Lender. The Credit Agreement provides for an up to $100.0 million revolving credit facility (as amended, the “Credit Facility”) with a maturity date of February 5, 2016. The borrowing base under the Credit Facility is determined at the discretion of the Lender based on, among other things, the Lender’s estimated value of the proved reserves attributable to the Borrowers’ oil and natural gas properties that have been mortgaged to the Lender, and is subject to regular redeterminations on September 30 and March 31 of each year, and interim redeterminations described in the Credit Agreement and potentially monthly commitment reductions, in each case which may reduce the amount of the borrowing base. As of September 30, 2014, the borrowing base was $30.0 million. | |||||||||
A portion of the Credit Facility, in an aggregate amount not to exceed $2.0 million, may be used to issue letters of credit for the account of Borrowers. The Borrowers may be required to prepay the Credit Facility in the event of a borrowing base deficiency as a result of over-advances, sales of oil and gas properties or terminations of hedging transactions. | |||||||||
Amounts outstanding under the Credit Facility bear interest at a rate per annum equal to the greater of (x) the U.S. prime rate as published in The Wall Street Journal’s “Money Rates” table in effect from time to time and (y) 4.0% (4.0% at September 30, 2014). Interest is payable monthly in arrears on the last day of each calendar month. Borrowings under the Credit Facility are secured by first priority liens on substantially all the property of each of the Borrowers and are unconditionally guaranteed by Doral West Corp. and Pure Energy Operating, Inc., each a subsidiary of Cross Border. | |||||||||
Under the Credit Agreement, the Borrowers are required to pay fees consisting of (i) an unused facility fee equal to 0.5% multiplied by the average daily unused commitment amount, payable quarterly in arrears until the commitment is terminated; (ii) a fronting fee payable on the date of issuance of each letter of credit and annually thereafter or on the date of any increase or extension thereof, equal to the greater of (a) 2.0% per annum multiplied by the face amount of such letter of credit or (b) $1,000; and (iii) an origination fee (x) of $200,000, and (y) payable on any date the commitment is increased, an additional facility fee equal to 1.0% multiplied by any increase of the commitment above the highest previously determined or redetermined commitment. | |||||||||
The Credit Agreement contains negative covenants that may limit the Borrowers’ ability to, among other things, incur liens, incur additional indebtedness, enter into mergers, sell assets, make investments and pay dividends. The Credit Agreement permits the payment of cash dividends on the Company’s 10.0% Series A Convertible Redeemable Preferred Stock (the “Series A Preferred Stock”) so long as the Company is not otherwise in default under the Credit Agreement and payment of such cash dividends would not cause the Company to be in default under the Credit Agreement. | |||||||||
The Credit Agreement also contains financial covenants, measured as of the last day of each fiscal quarter of Red Mountain, requiring the Borrowers to maintain a ratio of (i) the Borrowers’ and their consolidated subsidiaries’ consolidated current assets (inclusive of the unfunded commitment amount under the Credit Agreement) to consolidated current liabilities (exclusive of the current portion of long-term debt under the Credit Agreement) of at least 1.00 to 1.00; (ii) the Borrowers’ and their subsidiaries’ consolidated “Funded Debt” to consolidated EBITDAX (for the four fiscal quarter period then ended) of less than 3.50 to 1.00; and (iii) the Borrowers’ and their subsidiaries’ consolidated EBITDAX less paid and accrued dividends on the Series A Preferred Stock to interest expenses (each for the four fiscal quarter period then ended) of at least 3.00 to 1.00. Funded Debt is defined in the Credit Agreement as the sum of all debt for borrowed money, whether as a direct or reimbursement obligor, but excludes shares of Series A Preferred Stock. EBITDAX is defined in the Credit Agreement as (a) consolidated net income plus (b) (i) interest expense, (ii) income taxes, (iii) depreciation, (iv) depletion and amortization expenses, (v) dry hole and exploration expenses, (vi) non-cash losses or charges on any hedge agreements resulting from derivative accounting, (vii) extraordinary or non-recurring losses, (viii) expenses that could be capitalized under GAAP but by election of Borrowers are being expensed for such period under GAAP, (ix) costs associated with intangible drilling costs, (x) other non-cash charges, (xi) one-time expenses associated with transactions associated with (b)(i) through (iv), minus (c)(i) non-cash income on any hedge agreements resulting from FASB Statement 133, (ii) extraordinary or non-recurring income, and (iii) other non-cash income. | |||||||||
Amounts outstanding under the Credit Facility may be accelerated and become immediately due and payable upon specified events of default of Borrowers, including, among other things, a default in the payment of principal, interest or other amounts due under the Credit Facility, certain loan documents or hydrocarbon hedge agreements, failure to perform or observe covenants under the Credit Facility, a material inaccuracy of a representation or warranty, a default with regard to certain loan documents which remains unremedied for a period of 30 days following notice, a default in the payment of other indebtedness of the Borrowers of $200,000 or more, bankruptcy or insolvency, certain changes in control, failure of the Lender’s security interest in any portion of the collateral with a value greater than $500,000, cessation of any security document to be in full force and effect, or Alan Barksdale ceasing to be Red Mountain’s Chief Executive Officer or Chairman of Cross Border and not being replaced with an officer acceptable to the Lender within 30 days. | |||||||||
Pursuant to the Credit Agreement, at least one of the Borrowers is required to have acceptable hedge agreements in place at all times effectively hedging at least 50% of the oil volumes of the Borrowers. Red Mountain has outstanding hedge agreements with various counterparties hedging a portion of the future oil production of the Borrowers. However, these hedge agreements did not comply with the volume and time period requirements of the Credit Agreement as of September 30, 2014. | |||||||||
As of September 30, 2014, the Borrowers had collectively borrowed $26.8 million and had availability of $3.2 million under the Credit Facility. On October 14, 2014, the Company borrowed an additional $1.0 million under the Credit Facility. The Company was not in compliance with all of the financial covenants and the hedge agreement covenant under the Credit Facility described above at September 30, 2014, which constitutes an event of default under the Credit Facility, and the Lender has the right to accelerate all amounts outstanding under the Credit Facility upon notice to the Borrowers. As a result, the Company has recorded the full amount of its outstanding borrowings under the Credit Facility as a current liability on its Consolidated Balance Sheet as of September 30, 2014. | |||||||||
Mandatorily Redeemable Preferred Stock | |||||||||
The Company’s Series A Preferred Stock is mandatorily redeemable and is not convertible into shares of the Company’s common stock. The Company classifies the Series A Preferred Stock as a long-term liability, and the Company records dividends paid or accrued as interest expense in the Company’s Condensed Consolidated Statement of Operations. | |||||||||
In August 2013, the Company closed offerings of 376,685 Units, raising net cash proceeds of $7.1 million. Each Unit consisted of one share of Series A Preferred Stock and one warrant to purchase up to 2.5 shares of common stock at a price of $22.50 per Unit. The warrants are exercisable until the earlier of (i) August 2016 or (ii) the first trading day that is at least 30 days after the date that the Company has provided notice to the holders of the warrants by filing a Current Report on Form 8-K stating that the common stock has (A) achieved a 20 trading day volume weighted average price of $15.00 per share or more and (B) traded, in the aggregate, 300,000 shares or more over the same 20 consecutive trading days for which the 20 trading day volume weighted average price was calculated; provided, that clause (ii) shall only be applicable so long as a warrant is exercisable for shares of common stock. The warrants have an exercise price of $10.00 per share. The warrants issued with the Series A Preferred Stock were valued at $2.4 million. The value of the warrants is treated as a discount to the Series A Preferred Stock and will be accreted over the life of the mandatorily redeemable preferred stock. Management determined the fair value using a probability weighted Black-Scholes option model with a volatility based on the historical closing price of common stock of industry peers and the closing price of the Company’s common stock on the OTCBB on the date of issuance. The volatility and remaining term was approximately 55% and three years, respectively. | |||||||||
The Series A Preferred Stock is mandatorily redeemable on July 15, 2018 at $25.00 per share, plus accrued and unpaid dividends to the redemption date, for a total redeemable value of $11.9 million at the time of issuance. The difference between the $11.9 million redeemable value and the $10.8 million of gross proceeds and canceled debt is treated as a discount and will be accreted over the life of the Series A Preferred Stock. Effective as of April 1, 2014, the Company agreed to exchange 222,224 outstanding shares of its Series A Preferred Stock for the issuance of 1,388,898 shares of common stock. After the exchange, the Company had 254,463 shares of Series A Preferred Stock outstanding with an aggregate redemption amount of $6.4 million as of September 30, 2014. | |||||||||
For the three months ended September 30, 2014, the Company recognized total interest expense of $0.3 million related to the Series A Preferred Stock, which includes accretion of discount and issuance cost of $0.1 million for the three months ended September 30, 2014. | |||||||||
Schedule of Future Debt Payments | |||||||||
The following is a schedule by fiscal year of future principal payments required under the Company’s outstanding debt as of September 30, 2014: | |||||||||
(in thousands) | |||||||||
Fiscal Years Ending June 30, | |||||||||
2015 | $ | 26,800 | |||||||
2016 | — | ||||||||
2017 | — | ||||||||
2018 | — | ||||||||
2019 | 6,362 | ||||||||
Total | 33,162 | ||||||||
Discount | (1,464 | ) | |||||||
Total, net value | $ | 31,698 | |||||||
Earnings_Per_Share
Earnings Per Share | 3 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Earnings Per Share | ' | ||||||||
9. Earnings Per Share | |||||||||
The Company reports basic earnings per common share, which excludes the effect of potentially dilutive securities, and diluted earnings per common share, which includes the effect of all potentially dilutive securities unless their impact is anti-dilutive. The following are reconciliations of the numerators and denominators of basic and diluted earnings per share: | |||||||||
Three Months Ended | |||||||||
September 30, | |||||||||
2014 | 2013 | ||||||||
(dollars in thousands, except per share amounts) | |||||||||
Net loss (numerator): | |||||||||
Net loss – basic | $ | (2,892 | ) | $ | (1,129 | ) | |||
Weighted average shares (denominator): | |||||||||
Weighted average shares – basic | 14,857 | 12,922 | |||||||
Dilution effect of share-based compensation, treasury method(1) | — | — | |||||||
Weighted average shares – diluted | 14,857 | 12,922 | |||||||
Loss per share: | |||||||||
Basic | $ | (0.19 | ) | $ | (0.10 | ) | |||
Diluted | $ | (0.19 | ) | $ | (0.10 | ) | |||
-1 | Approximately 1,349,051 and 1,653,559 shares of common stock underlying warrants to purchase shares of the Company’s common stock were excluded from this calculation because they were anti-dilutive during the periods ended September 30, 2014 and 2013, respectively. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | ||||||
Sep. 30, 2014 | |||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||
Commitments and Contingencies | ' | ||||||
10. Commitments and Contingencies | |||||||
Litigation | |||||||
On May 4, 2011, Clifton M. (Marty) Bloodworth filed a lawsuit in the State District Court of Midland County, Texas, against Doral West Corp. d/b/a Doral Energy Corp. and Everett Willard Gray II. Mr. Bloodworth alleges that Mr. Gray, as CEO of Cross Border, made false representations which induced Mr. Bloodworth to enter into an employment contract that was subsequently breached by Cross Border. The claims that Mr. Bloodworth has alleged are: breach of his employment agreement with Doral West Corp, common law fraud, civil conspiracy breach of fiduciary duty, and violation of the Texas Deceptive Trade Practices-Consumer Protection Act. Mr. Bloodworth is seeking damages of approximately $280,000. Mr. Gray and Cross Border deny that Mr. Bloodworth’s claims have any merit. | |||||||
Cross Border was previously party to an engagement letter, dated February 7, 2012 (the “Engagement Letter”) with KeyBanc Capital Markets Inc. (“KeyBanc”) pursuant to which KeyBanc was to act as exclusive financial advisor to Cross Border’s board of directors in connection with a possible “Transaction” (as defined in the Engagement Letter). The Engagement Letter was formally terminated by Cross Border on August 21, 2012. The Engagement Letter provided that KeyBanc would be entitled to a fee upon consummation of a Transaction within a certain period of time following termination of the Engagement Letter. On May 16, 2013, KeyBanc delivered an invoice to Cross Border representing a fee and out-of-pocket expenses purportedly owed by Cross Border to KeyBanc as a result of the consummation of a purported Transaction that KeyBanc asserts had been consummated within the required time period. Cross Border disputed that any Transaction was consummated and that KeyBanc was entitled to any fees or out-of-pocket expenses. Cross Border filed a complaint seeking (i) a declaration that it was not liable to KeyBanc for any amounts in connection with the Engagement Letter, (ii) attorneys’ fees, and (iii) costs of suit. KeyBanc filed a counterclaim seeking (i) compensatory damages, (ii) interest, (iii) expenses and court costs, and (iv) reasonable and necessary attorneys’ fees. The matter was originally filed in the 44th Judicial District Court for the State of Texas, Dallas County but was subsequently removed to the United States District Court for the Northern District of Texas, Dallas Division. On August 26, 2014, Cross Border entered into a settlement agreement with KeyBanc, settling a lawsuit between the parties. In connection with the settlement, Cross Border agreed to pay KeyBanc $900,000 in three equal installments of $300,000 each on or before August 28, 2014, October 31, 2014 and December 31, 2014, and the parties agreed to mutual releases of liability related to the Engagement Letter. The Company fully accrued this amount at June 30, 2014. The Company paid the first installment and the remaining installments are recorded in accrued expenses on the Company’s Consolidated Balance Sheets at September 30, 2014. | |||||||
In addition to the foregoing, in the ordinary course of business, the Company is periodically a party to various litigation matters that it does not believe will have a material adverse effect on its results of operations or financial condition. | |||||||
Environmental Issues | |||||||
The Company is subject to federal and state laws and regulations relating to the protection of the environment. Environmental risk is inherent in all oil and natural gas operations, and the Company could be subject to environmental cleanup and enforcement actions. The Company manages this environmental risk through appropriate environmental policies and practices to minimize the impact to the Company. | |||||||
As of September 30, 2014, the Company had approximately $2.1 million in environmental remediation liabilities related to Cross Border’s operated Tom Tom and Tomahawk fields located in Chaves and Roosevelt counties in New Mexico. In February 2013, the Bureau of Land Management (“BLM”) accepted Cross Border’s remediation plan for the Tom Tom and Tomahawk fields. Cross Border is working in conjunction with the BLM to initiate remediation on a site-by-site basis. This is management’s best estimate of the costs of remediation and restoration with respect to these environmental matters, although the ultimate cost could differ materially. Inherent uncertainties exist in these estimates due to unknown conditions, changing governmental regulation, and legal standards regarding liability, and emerging remediation technologies for handling site remediation and restoration. Cross Border has incurred approximately $43,000 in costs and expects to incur the remaining expenditures during the Company’s fiscal year ending June 30, 2015. | |||||||
Leases | |||||||
As of September 30, 2014, the Company rented various office spaces in Dallas, Texas; Midland, Texas; and Lafayette, Louisiana under non-cancelable lease agreements. In the aggregate, these leases cover approximately 16,884 square feet at a cost of approximately $24,000 per month and have remaining lease terms ranging from 2 months to 24 months. The following is a schedule by year of future minimum rental payments required under these lease arrangements as of September 30, 2014: | |||||||
(in thousands) | |||||||
Fiscal Years Ending June 30, | |||||||
2015 | $ | 147 | |||||
2016 | 181 | ||||||
2017 | 45 | ||||||
2018 | — | ||||||
Total | $ | 373 | |||||
Rent expense under the Company’s lease arrangements amounted to approximately $74,000 and $69,000 for the three months ended September 30, 2014 and 2013, respectively. | |||||||
Related_Party_Transactions
Related Party Transactions | 3 Months Ended |
Sep. 30, 2014 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
11. Related Party Transactions | |
Enerstar Resources O&G, LLC (“Enerstar”), a company owned by Tommy Folsom, the former Executive Vice President and Director of Exploration and Production for RMR Operating, LLC, a subsidiary of the Company, and formerly the Executive Vice President and Director of Exploration and Production for the Company, owns an overriding royalty interest in the Company’s Madera Prospect. During the three months ended September 30, 2014 and 2013, the Company paid royalties of approximately $7,000 and $3,000, respectively, to Enerstar. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 3 Months Ended |
Sep. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation | |
The condensed consolidated financial statements include the accounts of Red Mountain Resources, Inc. and its subsidiaries. The condensed consolidated financial statements and related footnotes are presented in accordance with generally accepted accounting principles in the United States (“GAAP”). | |
The Company has prepared the accompanying unaudited interim financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”), and in the opinion of management, such financial statements reflect all adjustments necessary to present fairly the consolidated financial position of the Company at September 30, 2014 and June 30, 2014 and its results of operations and cash flows for the periods presented. The Company has omitted certain information and disclosures normally included in annual financial statements prepared in accordance with GAAP pursuant to those rules and regulations, although the Company believes that the disclosures it has made are adequate to make the information presented not misleading. These unaudited interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related footnotes included in its most recent Annual Report on Form 10-K. | |
In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect reported amounts in the financial statements and disclosures. The results of operations for the interim periods are not necessarily indicative of the results the Company expects for the full fiscal year. The Company has not made any changes in its significant accounting policies from those disclosed in its most recent Annual Report on Form 10-K. | |
Noncontrolling Interests | ' |
Noncontrolling Interests | |
Subsequent to January 28, 2013, the Company accounts for the noncontrolling interest in Cross Border Resources, Inc. (“Cross Border”) in accordance with ASC Topic 810, Consolidation (“ASC 810”). ASC 810 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to the noncontrolling interest, changes in a parent’s ownership interest and the valuation of retained noncontrolling equity investments when a subsidiary is deconsolidated. ASC 810 also establishes reporting requirements that provide sufficient disclosures that clearly identify and distinguish between the interest of the parent and the interests of the noncontrolling owner. In addition, this guidance provides for increases and decreases in the Company’s controlling financial interests in consolidated subsidiaries to be reported in equity similar to treasury stock transactions. | |
Debentures - held to maturity | ' |
Debentures - held to maturity | |
The Company’s investments in non-performing debentures were initially recorded at cost which the Company believes was fair value. Management estimated cash flows expected to be collected considering the contractual terms of the loans, the nature and estimated fair value of collateral, and other factors it deemed appropriate. The estimated fair value of the loans at acquisition was significantly less than the contractual amounts due under the terms of the loan agreements. | |
Since, at the acquisition date, the Company expected to collect less than the contractual amounts due under the terms of the loans based, at least in part, on the assessment of the credit quality of the borrower, the loans are accounted for in accordance with ASC Topic 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality (“ASC 310-30”). The difference between the contractually required payments on the loans as of the acquisition date and the total cash flows expected to be collected, or non-accretable difference, is not recognized and totaled $2.1 million and $2.1 million, plus accrued interest in arrears as of September 30, 2014 and June 30, 2014, respectively. | |
Debentures are classified as non-accrual when management is unable to reasonably estimate the timing or amount of cash flows expected to be collected from the debentures or has serious doubts about further collectability of principal or interest. As of September 30, 2014 and June 30, 2014, all of the Company’s debentures were on non-accrual status since the borrower remains under the supervision of the bankruptcy court. | |
The Company periodically re-evaluates cash flows expected to be collected for each debenture based upon all available information as of the measurement date. Subsequent increases in cash flows expected to be collected are recognized prospectively through an adjustment to the debenture’s yield over its remaining life, which may result in a reclassification from non-accretable difference to accretable yield. Subsequent decreases in cash flows expected to be collected are evaluated to determine whether a provision for loan loss should be established. If decreases in expected cash flows result in a decrease in the estimated fair value of the debenture below its amortized cost, the debenture is deemed to be impaired and the Company will record a provision for impairment to write the debenture down to its estimated fair value. The Company did not record an impairment during the three months ended September 30, 2014. | |
The Company’s investments in non-performing debentures are classified as held to maturity because the Company has the intent and ability to hold them until maturity. | |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements | |
In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”), which requires management to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter, and early adoption is permitted. The Company is currently in the process of evaluating the impact the adoption of ASU 2014-15 will have on the Company’s consolidated financial statements. |
Oil_and_Natural_Gas_Properties1
Oil and Natural Gas Properties and Other Property and Equipment (Tables) | 3 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Oil and Gas Property [Abstract] | ' | ||||||||
Schedule of Capitalized Costs Relating to Oil and Gas Producing Activities | ' | ||||||||
The following table sets forth the capitalized costs under the successful efforts method for oil and natural gas properties: | |||||||||
September 30, | June 30, | ||||||||
2014 | 2014 | ||||||||
(in thousands) | |||||||||
Oil and natural gas properties: | |||||||||
Proved | $ | 85,146 | $ | 82,362 | |||||
Unproved | 19,043 | 19,109 | |||||||
Total oil and natural gas properties | 104,189 | 101,471 | |||||||
Less accumulated depletion and impairment | (21,456 | ) | (19,138 | ) | |||||
Net oil and natural gas properties capitalized costs | $ | 82,733 | $ | 82,333 | |||||
Schedule of Property, Plant and Equipment | ' | ||||||||
The historical cost of other property and equipment, presented on a gross basis with accumulated depreciation and amortization is summarized as follows: | |||||||||
September 30, | June 30, | ||||||||
2014 | 2014 | ||||||||
(in thousands) | |||||||||
Other property and equipment | $ | 1,139 | $ | 1,196 | |||||
Less accumulated depreciation and amortization | (521 | ) | (359 | ) | |||||
Net property and equipment | $ | 618 | $ | 837 | |||||
Asset_Retirement_Obligations_T
Asset Retirement Obligations (Tables) | 3 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Asset Retirement Obligation Disclosure [Abstract] | ' | ||||||||
Schedule Of Changes in Asset Retirement Obligation | ' | ||||||||
The following table summarizes the changes in the Company’s asset retirement obligations (“AROs”) for the periods indicated: | |||||||||
Three Months Ended | Fiscal Year Ended | ||||||||
September 30, | June 30, | ||||||||
2014 | 2014 | ||||||||
(in thousands) | |||||||||
Asset retirement obligations at beginning of period | $ | 5,745 | $ | 5,020 | |||||
Liabilities incurred | 5 | 75 | |||||||
Liabilities settled | (36 | ) | (2 | ) | |||||
Accretion expense | 34 | 267 | |||||||
Revisions in estimated liabilities | — | 385 | |||||||
Asset retirement obligations at end of period | 5,748 | 5,745 | |||||||
Less: current portion | 178 | 214 | |||||||
Long-term portion | $ | 5,570 | $ | 5,531 | |||||
Derivatives_Tables
Derivatives (Tables) | 3 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||
Schedule of commodity derivative positions | ' | ||||||||||
At September 30, 2014, the Company had the following commodity derivatives positions outstanding: | |||||||||||
Commodity and Time Period | Contract | Volume Transacted | Contract Price | ||||||||
Type | |||||||||||
Crude Oil | |||||||||||
October 1, 2014―November 30, 2014 | Swap | 2,000 Bbls/month | $ | 93.50/Bbl | |||||||
October 1, 2014―December 31, 2014 | Put | 1,979-8,330 Bbls/month | $95.00 - $100.00/Bbl | ||||||||
October 1, 2014―January 31, 2015 | Put | 6,000 Bbls/month | $ | 95.00/Bbl | |||||||
Schedule of fair value of open commodity derivatives | ' | ||||||||||
The following table summarizes the fair value of the Company’s open commodity derivatives as of September 30, 2014 and June 30, 2014: | |||||||||||
Balance Sheet Location | Fair Values | ||||||||||
September 30, | June 30, | ||||||||||
2014 | 2014 | ||||||||||
(in thousands) | |||||||||||
Derivatives not designated as hedging instruments | |||||||||||
Commodity derivatives | Commodities derivative asset | $ | 189 | $ | 37 | ||||||
Commodity derivatives | Commodities derivative liability | $ | — | $ | (121 | ) | |||||
Schedule of change in fair value of commodity derivatives | ' | ||||||||||
The following table summarizes the change in the fair value of the Company’s commodity derivatives: | |||||||||||
Income Statement Location | Three Months Ended | ||||||||||
September 30, | |||||||||||
2014 | 2013 | ||||||||||
(in thousands) | |||||||||||
Derivatives not designated as hedging instruments | |||||||||||
Commodity derivatives | Gain (loss) on commodity derivatives | $ | 268 | $ | (384 | ) | |||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 3 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Summary of the valuation of the Company's financial assets and liabilities | ' | ||||||||||||||||
The following table summarizes the valuation of the Company’s financial assets and liabilities at September 30, 2014 and June 30, 2014: | |||||||||||||||||
Fair Value Measurements at Reporting Date Using | |||||||||||||||||
Quoted Prices in | Significant or | Significant | Fair Value at | ||||||||||||||
Active Markets for | Other Observable | Unobservable | 30-Sep-14 | ||||||||||||||
Identical Assets or | Inputs (Level 2) | Inputs (Level 3) | |||||||||||||||
Liabilities (Level 1) | |||||||||||||||||
(in thousands) | |||||||||||||||||
Assets: | |||||||||||||||||
Commodity derivatives | $ | — | $ | 189 | $ | — | $ | 189 | |||||||||
Oil and gas properties impairment (non-recurring) | — | — | (36 | ) | (36 | ) | |||||||||||
Total | $ | — | $ | 189 | $ | (36 | ) | $ | 153 | ||||||||
Liabilities: | |||||||||||||||||
Asset retirement obligations (non-recurring) | $ | — | $ | — | $ | (5,748 | ) | $ | (5,748 | ) | |||||||
Environmental remediation liability | — | — | (2,057 | ) | (2,057 | ) | |||||||||||
Total | $ | — | $ | — | $ | (7,805 | ) | $ | (7,805 | ) | |||||||
Fair Value Measurements at Reporting Date Using | |||||||||||||||||
Quoted Prices in | Significant or | Significant | Fair Value at | ||||||||||||||
Active Markets for | Other Observable | Unobservable | 30-Jun-14 | ||||||||||||||
Identical Assets or | Inputs (Level 2) | Inputs (Level 3) | |||||||||||||||
Liabilities (Level 1) | |||||||||||||||||
(in thousands) | |||||||||||||||||
Assets: | |||||||||||||||||
Commodity derivatives | $ | — | $ | 37 | $ | — | $ | 37 | |||||||||
Oil and gas properties impairment (non-recurring) | — | — | (487 | ) | (487 | ) | |||||||||||
Total | $ | — | $ | 37 | $ | (487 | ) | $ | (450 | ) | |||||||
Liabilities: | |||||||||||||||||
Asset retirement obligations (non-recurring) | $ | — | $ | — | $ | (5,745 | ) | $ | (5,745 | ) | |||||||
Commodities derivative liability | — | (121 | ) | — | (121 | ) | |||||||||||
Environmental remediation liability | — | — | (2,067 | ) | (2,067 | ) | |||||||||||
Total | $ | — | $ | (121 | ) | $ | (7,812 | ) | $ | (7,933 | ) | ||||||
Summary of changes to fair value measurements using Level 3 inputs | ' | ||||||||||||||||
The following is a summary of changes to fair value measurements using Level 3 inputs during the quarter ended September 30, 2014: | |||||||||||||||||
(in thousands) | Environmental | ||||||||||||||||
Liability | |||||||||||||||||
Balance, June 30, 2014 | $ | (2,067 | ) | ||||||||||||||
Settlement of liabilities | 10 | ||||||||||||||||
Balance, September 30, 2014 | $ | (2,057 | ) | ||||||||||||||
Debt_Tables
Debt (Tables) | 3 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Schedule of debt | ' | ||||||||
As of the dates indicated, the Company’s debt consisted of the following: | |||||||||
September 30, | June 30, | ||||||||
2014 | 2014 | ||||||||
(in thousands) | |||||||||
Credit Facility | $ | 26,800 | $ | 26,800 | |||||
Mandatorily redeemable preferred stock and accrued dividends, net of discount of $1,464 and $1,561, respectively | 4,898 | 4,801 | |||||||
Total debt | 31,698 | 31,601 | |||||||
Less: short-term portion | 26,800 | — | |||||||
Long-term debt | $ | 4,898 | $ | 31,601 | |||||
Schedule by fiscal year of future principal payments of debt | ' | ||||||||
The following is a schedule by fiscal year of future principal payments required under the Company’s outstanding debt as of September 30, 2014: | |||||||||
(in thousands) | |||||||||
Fiscal Years Ending June 30, | |||||||||
2015 | $ | 26,800 | |||||||
2016 | |||||||||
2017 | |||||||||
2018 | |||||||||
2019 | 6,362 | ||||||||
Total | 33,162 | ||||||||
Discount | (1,464 | ) | |||||||
Total, net value | $ | 31,698 |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 3 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Schedule of reconciliations of the numerators and denominators of basic and diluted earnings per share | ' | ||||||||
The following are reconciliations of the numerators and denominators of basic and diluted earnings per share: | |||||||||
Three Months Ended | |||||||||
September 30, | |||||||||
2014 | 2013 | ||||||||
(dollars in thousands, except per share amounts) | |||||||||
Net loss (numerator): | |||||||||
Net loss – basic | $ | (2,892 | ) | $ | (1,129 | ) | |||
Weighted average shares (denominator): | |||||||||
Weighted average shares – basic | 14,857 | 12,922 | |||||||
Dilution effect of share-based compensation, treasury method(1) | — | — | |||||||
Weighted average shares – diluted | 14,857 | 12,922 | |||||||
Loss per share: | |||||||||
Basic | $ | (0.19 | ) | $ | (0.10 | ) | |||
Diluted | $ | (0.19 | ) | $ | (0.10 | ) | |||
-1 | Approximately 1,349,051 and 1,653,559 shares of common stock underlying warrants to purchase shares of the Company’s common stock were excluded from this calculation because they were anti-dilutive during the periods ended September 30, 2014 and 2013, respectively. |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 3 Months Ended | ||||||
Sep. 30, 2014 | |||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||
Schedule of future minimum rental payments | ' | ||||||
The following is a schedule by year of future minimum rental payments required under these lease arrangements as of September 30, 2014: | |||||||
(in thousands) | |||||||
Fiscal Years Ending June 30, | |||||||
2015 | $ | 147 | |||||
2016 | 181 | ||||||
2017 | 45 | ||||||
2018 | — | ||||||
Total | $ | 373 |
Organization_Details_Narrative
Organization (Details Narrative) | 1 Months Ended | |||
In Thousands, unless otherwise specified | Jan. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Jan. 30, 2014 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ' | ' | ' |
Reverse stock split exchange ratio | 0.1 | ' | ' | ' |
Common stock, authorized shares | 50,000 | 50,000 | 50,000 | 500,000 |
Common stock, outstanding shares | 13,400 | 14,790 | 14,790 | 134,000 |
Going_Concern_Details_Narrativ
Going Concern (Details Narrative) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2014 |
Going Concern | ' | ' | ' |
Net income (loss) attributable to Red Mountain Resources, Inc. | ($2,892) | ($1,275) | ' |
Total debt | 31,698 | ' | 31,601 |
Debt discount | 1,464 | ' | ' |
Working capital deficit | 31,900 | ' | ' |
Line of credit - current | $26,800 | ' | ' |
Significant_Accounting_Policie2
Significant Accounting Policies (Details Narrative) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Accounting Policies [Abstract] | ' | ' |
Non-accretable difference of debentures | $2,100 | $2,100 |
Oil_and_Natural_Gas_Properties2
Oil and Natural Gas Properties and Other Property and Equipment (Details Narrative) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2014 |
Oil and Gas Property [Abstract] | ' | ' | ' |
Acquisition costs of proved properties | $38,800 | ' | $39,000 |
Exploratory well costs and additional development costs | 45,800 | ' | 39,600 |
Transfer of exploratory well costs to proved properties | 30 | 0 | ' |
Explorary drilling costs | 50,500 | 0 | ' |
Impairment on oil and gas properties | $36 | ' | ' |
Oil_and_Natural_Gas_Properties3
Oil and Natural Gas Properties and Other Property and Equipment (Details) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Oil and natural gas properties: | ' | ' |
Proved | $85,146 | $82,362 |
Unproved | 19,043 | 19,109 |
Total oil and natural gas properties | 104,189 | 101,471 |
Less accumulated depletion and impairment | -21,456 | -19,138 |
Net oil and natural gas properties capitalized costs | $82,733 | $82,333 |
Oil_and_Natural_Gas_Properties4
Oil and Natural Gas Properties and Other Property and Equipment (Details 1) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Oil and Gas Property [Abstract] | ' | ' |
Other property and equipment | $1,139 | $1,196 |
Less accumulated depreciation and amortization | -521 | -359 |
Net property and equipment | $618 | $837 |
Asset_Retirement_Obligations_D
Asset Retirement Obligations (Details) (USD $) | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2014 |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ' | ' | ' |
Asset retirement obligations at beginning of period | $5,745 | $5,020 | $5,020 |
Liabilities incurred | 5 | ' | 75 |
Liabilities settled | -36 | ' | -2 |
Accretion expense | 34 | 67 | 267 |
Revisions in estimated liabilities | ' | ' | 385 |
Asset retirement obligations at end of period | 5,748 | ' | 5,745 |
Less: current portion | 178 | ' | 214 |
Long-term portion | $5,570 | ' | $5,531 |
Derivatives_Details
Derivatives (Details) | 3 Months Ended |
Sep. 30, 2014 | |
Crude Oil Contract 1 [Member] | ' |
Derivative Time Period | 'October 1, 2014 - November 30, 2014 |
Type | 'Swap |
Volume transacted | '2,000 Bbls/month |
Contract Price | 93.5 |
Volume transacted - lower | 2,000 |
Crude Oil Contract 2 [Member] | ' |
Derivative Time Period | 'October 1, 2014 - December 31, 2014 |
Type | 'Put |
Volume transacted | '1,979 - 8,330 Bbls/month |
Volume transacted - lower | 1,979 |
Volume transacted - higher | 8,330 |
Crude Oil Contract 2 [Member] | Lower Range [Member] | ' |
Contract Price | 95 |
Crude Oil Contract 2 [Member] | Upper Range [Member] | ' |
Contract Price | 100 |
Crude Oil Contract 3 [Member] | ' |
Derivative Time Period | 'October 1, 2014 - January 31, 2015 |
Type | 'Put |
Volume transacted | '6,000 Bbls/month |
Contract Price | 95 |
Volume transacted - lower | 6,000 |
Derivatives_Details_1
Derivatives (Details 1) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ' |
Commodity derivative asset - fair value | $189 | $37 |
Commodity derivative liability - fair value | ' | ($121) |
Derivatives_Details_2
Derivatives (Details 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ' |
Change in fair value of derivative liability | $273 | ($382) |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2013 |
In Thousands, unless otherwise specified | |||
Assets | ' | ' | ' |
Commodities derivatives | $189 | $37 | ' |
Liabilities | ' | ' | ' |
Asset retirement obligations (non-recurring) | -5,748 | -5,745 | -5,020 |
Commodities derivative liability | ' | -121 | ' |
Fair Value [Member] | ' | ' | ' |
Assets | ' | ' | ' |
Commodities derivatives | ' | 37 | ' |
Oil and gas properties impairment (nonrecurring) | ' | -487 | ' |
Total | ' | -450 | ' |
Liabilities | ' | ' | ' |
Asset retirement obligations (non-recurring) | ' | -5,745 | ' |
Commodities derivative liability | ' | -121 | ' |
Environmental remediation liability | ' | -2,067 | ' |
Total | ' | -7,933 | ' |
Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Assets | ' | ' | ' |
Commodities derivatives | 189 | 37 | ' |
Total | 189 | 37 | ' |
Liabilities | ' | ' | ' |
Commodities derivative liability | ' | -121 | ' |
Total | ' | -121 | ' |
Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Assets | ' | ' | ' |
Oil and gas properties impairment (nonrecurring) | -36 | -487 | ' |
Total | -36 | -487 | ' |
Liabilities | ' | ' | ' |
Asset retirement obligations (non-recurring) | -5,748 | -5,745 | ' |
Environmental remediation liability | -2,057 | -2,067 | ' |
Total | -7,805 | -7,812 | ' |
Fair Value [Member] | ' | ' | ' |
Assets | ' | ' | ' |
Commodities derivatives | 189 | ' | ' |
Oil and gas properties impairment (nonrecurring) | -36 | ' | ' |
Total | 153 | ' | ' |
Liabilities | ' | ' | ' |
Asset retirement obligations (non-recurring) | -5,748 | ' | ' |
Environmental remediation liability | -2,057 | ' | ' |
Total | ($7,805) | ' | ' |
Fair_Value_Measurements_Detail1
Fair Value Measurements (Details 1) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2014 |
Fair Value Disclosures [Abstract] | ' |
Balance, beginning | ($2,067) |
Settlement of liabilities | 10 |
Balance, ending | ($2,057) |
Debt_Details_Narrative
Debt (Details Narrative) (USD $) | 0 Months Ended | 3 Months Ended | |||
In Thousands, unless otherwise specified | Oct. 14, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Feb. 05, 2013 | Feb. 05, 2013 |
Credit Facility [Member] | Credit Facility [Member] | Credit Facility [Member] | |||
Letter of Credit [Member] | |||||
Lines of Credit (Credit facility and secured line) | ' | ' | ' | ' | ' |
Maximum borrowing capacity under line of credit | ' | ' | ' | $100,000 | $2,000 |
Current borrowing base of line of credit | ' | ' | 30,000 | ' | ' |
Variable interest rate description | ' | ' | 'U.S. prime rate published in The Wall Street Journal's "Money Rates" table plus 4.0% | ' | ' |
Spread on the variable interest rate | ' | ' | 4.00% | ' | ' |
Interest rate of line of credit | ' | ' | 4.00% | ' | ' |
Line of credit fee description | ' | ' | ' | ' | ' |
pay fees consisting of (i) an unused facility fee equal to 0.5% multiplied by the average daily unused commitment amount, payable quarterly in arrears until the commitment is terminated; (ii) a fronting fee payable on the date of issuance of each letter of credit and annually thereafter or on the date of any increase or extension thereof, equal to the greater of (a) 2.0% per annum multiplied by the face amount of such letter of credit or (b) $1,000; and (iii) an origination fee (x) of $200,000, and (y) payable on any date the commitment is increased, an additional facility fee equal to 1.0% multiplied by any increase of the commitment above the highest previously determined or redetermined commitment. | |||||
Unused Facility fee | ' | ' | ' | 0.50% | ' |
Percentage fee multiplied against face amount associated with an increase on the letter of credit | ' | ' | ' | 2.00% | ' |
Fee associated with an increase in letter of credit | ' | ' | ' | 1 | ' |
Origination fee | ' | ' | ' | 200 | ' |
Additional facility fee | ' | ' | ' | 1.00% | ' |
Required ratio of current assets to current liabilities under line of credit agreement | ' | ' | ' | 100.00% | ' |
Required ratio of funded debt to EBITDAX under line of credit agreement | ' | ' | ' | 350.00% | ' |
Required ratio of EBITDAX to interest expenses under line of credit agreement | ' | ' | ' | 300.00% | ' |
Line of credit default amount trigger to cause immediate payment | ' | ' | ' | 200 | ' |
Collateral security interest trigger to cause immediate payment | ' | ' | ' | 500 | ' |
Percentage of oil volume required to be effectively hedged | ' | ' | ' | 50.00% | ' |
Line of credit - current | ' | 26,800 | 26,800 | ' | ' |
Line of credit, remaining capacity | ' | ' | 3,200 | ' | ' |
Proceeds from line of credit | $1,000 | ' | ' | ' | ' |
Debt_Details_Narrative_1
Debt (Details Narrative 1) (USD $) | 0 Months Ended | 3 Months Ended | 0 Months Ended | 3 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Aug. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Apr. 02, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 |
N | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | |||
Units sold in period | 376,685 | ' | ' | ' | ' | ' | ' |
Proceeds from units sold, net | $7,100 | ' | ' | ' | ' | ' | ' |
Number of shares, per unit | 1 | ' | ' | ' | ' | ' | ' |
Number of warrants, per unit | 1 | ' | ' | ' | ' | ' | ' |
Number of shares callabe per warrant | 2.5 | ' | ' | ' | ' | ' | ' |
Exercise price, warrants | $22.50 | ' | ' | ' | ' | ' | ' |
Exercise price, units | 10 | ' | ' | ' | ' | ' | ' |
Warrant value | 2,400 | ' | ' | ' | ' | ' | ' |
Weighted average stock price per share | $15 | ' | ' | ' | ' | ' | ' |
Aggregate number of shares traded | 300,000 | ' | ' | ' | ' | ' | ' |
Volatility used for fair vaue | 55.00% | ' | ' | ' | ' | ' | ' |
Term used for fair vaue | '3 years | ' | ' | ' | ' | ' | ' |
Series A preferred stock, redemption price per share | ' | ' | ' | ' | ' | ' | $25 |
Series A preferred stock, redemption value | ' | ' | ' | ' | ' | ' | 11,900 |
Preferred stock gross proceeds and canceled debt amount | ' | ' | ' | ' | ' | ' | 10,800 |
Preferred stock, shares outstanding | ' | 354,463,000 | ' | 222,224 | ' | 254,463 | 254,463 |
Common stock issued at conversion of preferred stock, shares | ' | ' | ' | 1,388,898 | ' | ' | ' |
Redemption amount | ' | ' | ' | ' | ' | 6,400 | 6,400 |
Interest expense, preferred stock | ' | ' | ' | ' | 300 | ' | ' |
Accretion of discount and amortization of issuance costs | ' | $34 | $67 | ' | $100 | ' | ' |
Debt_Details
Debt (Details) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Debt Disclosure [Abstract] | ' | ' |
Credit Facility | $26,800 | $26,800 |
Mandatorily redeemable preferred stock, net of discount of $1,464 and $1,561, respectively | 4,898 | 4,801 |
Total debt | 31,698 | 31,601 |
Less: short-term portion | 26,800 | ' |
Long-term debt | $4,898 | $31,601 |
Debt_Details_1
Debt (Details 1) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Debt Maturing in Fiscal Year Ending June 30, | ' | ' |
2015 | $26,800 | ' |
2019 | 6,362 | ' |
Total | 33,162 | ' |
Discount | -1,464 | ' |
Total debt | $31,698 | $31,601 |
Earnings_Per_Share_Details_Nar
Earnings Per Share (Details Narrative) (Warrants [Member]) | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Warrants [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,349,051 | 1,653,559 |
Earnings_Per_Share_Details
Earnings Per Share (Details) (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | ||
Net loss (numerator): | ' | ' | ||
Net loss attributable to Red Mountain Resources, Inc - basic | ($2,892) | ($1,275) | ||
Weighted average shares (denominator): | ' | ' | ||
Weighted average shares - basic | 14,857 | 12,922 | ||
Weighted average shares - diluted | 14,857 | [1] | 12,922 | [1] |
Loss per share: | ' | ' | ||
Basic | ($0.19) | ($0.10) | ||
Diluted | ($0.19) | ($0.10) | ||
[1] | Approximately 1,349,051 and 1,653,559 shares of common stock underlying warrants to purchase shares of the Company?s common stock were excluded from this calculation because they were anti-dilutive during the periods ended September 30, 2014 and 2013, respectively. |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details Narrative) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Aug. 26, 2014 |
sqft | Settlement Agreement [Member] | ||
Lawsuit, damages sought | $280,000 | ' | ' |
Damages paid value in the legal matter in three equal installments | ' | ' | 900 |
Environmental remediation liabilities related to Cross Border | 2,100 | ' | ' |
Settlement of environmental liabilities | 43 | ' | ' |
Number of square feet covered in rentals | 16,884 | ' | ' |
Monthly rental payment | 24 | ' | ' |
Rent expense | $74 | $69 | ' |
Commitments_and_Contingencies_2
Commitments and Contingencies (Details) (USD $) | Sep. 30, 2014 |
In Thousands, unless otherwise specified | |
Future minimum rental payments in fiscal years ending June 30, | ' |
2015 | $147 |
2016 | 181 |
2017 | 45 |
Total | $373 |
Related_Party_Transactions_Det
Related Party Transactions (Details Narrative) (Enerstar Resources [Member], USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Enerstar Resources [Member] | ' | ' |
Royalty expense | $7 | $3 |