______________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 12, 2008
GEORESOURCES, INC.
(Exact name of Registrant as specified in its charter)
| | | | | |
| COLORADO | | 0-8041 | | 84-0505444 |
| | | | | |
| (State or other jurisdiction | | (Commission File Number) | | (IRS Employer Identification No.) |
| of incorporation) | | | | |
110 Cypress Station Drive, Suite 220
Houston, Texas 77090
(Address of principal executive offices) (Zip Code)
(281) 537-9920
(Registrant’s telephone number, including area code)
| Not Applicable |
| (Former Name or Former Address, if Changed Since Last Report) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:
___ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
___ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
___ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
___ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
______________________________________________________________________________
On May 12, 2008, GeoResources, Inc. issued a press release announcing financial results for the first quarter ended March 31, 2008. A copy of the press release is furnished with this report as Exhibit 99.9, and is incorporated herein by reference.
The information in this report is being furnished, not filed, for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be incorporated by reference into any filing under the Securities Act of 1933, as amended.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
| | | (d) | | Exhibits: |
| | | | | |
| | | | | The following exhibit is included with this Current Report on Form 8-K: |
| | | |
| Exhibit No. | | Description |
| | | |
| 99.9 | | GeoResources, Inc. Press Release dated May 12, 2008. |
SIGNATURE
Pursuant to the requirement of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| | | | | | | |
| | | GEORESOURCES, INC | | |
| | | | | | | |
| | | By: | | /s/ Frank A. Lodzinski Frank A. Lodzinski, President | | |
Date: May 14, 2008
EXHIBIT INDEX
| | | |
| Exhibit No. | | Description |
99.9 | | GeoResources, Inc. Press Release dated May 12, 2008. |
EXHIBIT 99.9
Contact: Cathy Kruse
Telephone: 701-572-2020 ext 113
cathyk@geoi.net
FOR IMMEDIATE RELEASE
GeoResources, Inc. Reports First Quarter Financial Results
Houston, Texas May 12, 2008 – GeoResources, Inc., (NASDAQ:GEOI), today announced its financial results for the quarter ended March 31, 2008, compared to the results for the same period in 2007. In a separate press release issued May 1, 2008, GeoResources, Inc. announced its operations update, including horizontal drilling in Texas and North Dakota.
For the three months ended March 31, 2008, the Company reported net income of $4.2 million, or $0.29 per share compared to $790,000 or $0.15 per share in 2007. Total revenue increased 482% to $23.9 million in the first quarter of 2008 compared to $4.1 million the same quarter in 2007.
Oil and natural gas production increased substantially in the first quarter. Natural gas production increased to 809 MMcf from 192 MMcf in the first quarter of 2007, an increase of 321%. Oil production for the first quarter increased to 200 MBbls from 46 MBbls in the prior year’s period, an increase of 335%. Properties acquired in the 2007 Merger accounted for increased production of approximately 57,000 Mcf of gas and approximately 36,000 barrels of oil during the first quarter of 2008. Properties acquired in the fourth quarter of 2007 accounted for increased production of approximately 420,000 Mcf of gas and approximately 108,000 barrels of oil during the first quarter of 2008. The remaining increases were due to our drilling program, re-engineering and workovers, as well as increased commodity prices.
The average realized price of natural gas was $7.73 per Mcf for the first quarter of 2008, 27% more than the first quarter of 2007. The average realized price of oil for the first quarter of 2008 was $81.00 per barrel or 56% more than the first quarter in the prior year.
Earnings before interest, income taxes, depreciation, depletion and amortization, and exploration expense (“EBITDAX”) increased 563% to approximately $12,267,000 for the first quarter 2008 compared to $1,878,000 in the prior year’s similar quarter.
The following table reconciles reported net income to EBITDAX for the periods indicated:
| EBITDAX (1) | | Three Months Ended March 31, | |
| | | 2008 | | | 2007 | |
| | | | | | | |
| | | | | | | |
| Net income | | $ | 4,224,683 | | | $ | 789,350 | |
| Add back: | | | | | | | | |
| Interest expense | | | 1,569,175 | | | | 156,152 | |
| Income tax | | | 2,596,438 | | | | 4,202 | |
| Depreciation, depletion and amortization | | | 3,876,949 | | | | 928,568 | |
| Exploration expense | | | - | | | | - | |
| | | | | | | | | |
| EBITDAX | | $ | 12,267,245 | | | $ | 1,878,272 | |
| | | | | | | | | |
| | | | | | | | | |
(1) EBITDAX is defined as earnings before interest, income taxes, depreciation, depletion and amortization, and exploration expense. EBITDAX should not be considered as an alternative to net income (as an indicator of operating performance) or as an alternative to cash flow (as a measure of liquidity or ability to service debt obligations) and is not in accordance with, nor superior to, generally accepted accounting principles, but provides additional information for evaluation of our operating performance.
About GeoResources, Inc.
GeoResources, Inc. is an independent oil and gas company engaged in the acquisition and development of oil and gas reserves through an active and diversified program which includes purchases of reserves, re-engineering, and development and exploration activities, currently focused in the Southwest and Gulf Coast, Williston Basin and Rocky Mountains. For more information, visit our website at www.georesourcesinc.com.
Forward-Looking Statements
Information herein contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as "may," "will," "expect," "anticipate," "estimate" or "continue," or comparable words. All statements other than statements of historical facts that address activities that the Company expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read the SEC reports of the Company, readers are encouraged to read our Annual Report on Form 10-KSB/A for the year ended December 31, 2007, and any and all other documents filed with the SEC regarding information about GeoResources for meaningful cautionary language in respect of the forward-looking statements herein. Interested persons are able to obtain free copies of filings containing information about GeoResources, without charge, at the SEC’s Internet site (http://www.sec.gov).
| GEORESOURCES, INC. and SUBSIDIARIES | |
| CONSOLIDATED BALANCE SHEETS | |
| | | March 31, | | | December 31, | |
| | | 2008 | | | 2007 | |
| | | (unaudited) | | | | |
| ASSETS | | | | | | |
| Current assets: | | | | | | |
| Cash | | $ | 17,163,949 | | | $ | 24,430,181 | |
| Accounts receivable: | | | | | | | | |
| Oil and gas revenues | | | 23,125,008 | | | | 20,365,111 | |
| Joint interest billings and other | | | 5,074,769 | | | | 3,913,461 | |
| Affiliated partnerships | | | 3,745,134 | | | | 3,360,017 | |
| Notes receivable | | | 120,000 | | | | 600,000 | |
| Oil and gas properties held for sale | | | 9,694,654 | | | | - | |
| Prepaid expenses and other | | | 1,902,159 | | | | 1,430,445 | |
| Total current assets | | | 60,825,673 | | | | 54,099,215 | |
| | | | | | | | | |
| Oil and gas properties, successful efforts method: | | | | | | | | |
| Proved properties | | | 176,537,239 | | | | 187,640,420 | |
| Unproved properties | | | 6,872,150 | | | | 5,139,309 | |
| Office and other equipment | | | 1,031,375 | | | | 995,365 | |
| Land | | | 96,462 | | | | 96,462 | |
| | | | 184,537,226 | | | | 193,871,556 | |
| Less accumulated depreciation, depletion and amortization | | | (14,568,762 | ) | | | (12,430,174 | ) |
| Net property and equipment | | | 169,968,464 | | | | 181,441,382 | |
| Other assets: | | | | | | | | |
| Equity in oil and gas limited partnerships | | | 2,003,514 | | | | 1,880,361 | |
| Deferred financing costs and other | | | 3,019,951 | | | | 2,937,312 | |
| | | $ | 235,817,602 | | | $ | 240,358,270 | |
| LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | | | |
| Current liabilities: | | | | | | | | |
| Accounts payable | | $ | 8,394,747 | | | $ | 11,374,221 | |
| Accounts payable to affiliated partnerships | | | 5,298,816 | | | | 4,271,238 | |
| Revenues and royalties payable | | | 23,275,950 | | | | 19,833,732 | |
| Drilling advances | | | 542,876 | | | | 882,367 | |
| Accrued expenses | | | 2,563,241 | | | | 2,599,915 | |
| Income taxes payable | | | 1,211,456 | | | | 1,239,172 | |
| Derivative financial instruments | | | 12,659,158 | | | | 6,527,360 | |
| Total current liabilities | | | 53,946,244 | | | | 46,728,005 | |
| Long-term debt | | | 86,000,000 | | | | 96,000,000 | |
| Deferred income taxes | | | 7,643,752 | | | | 6,476,433 | |
| Asset retirement obligations | | | 5,140,372 | | | | 7,826,856 | |
| Derivative financial instruments | | | 22,718,164 | | | | 15,295,948 | |
| Stockholders' equity: | | | | | | | | |
| Common stock, par value $.01 per share; authorized | | | | | | | | |
| 100,000,000 shares; 14,703,383 shares issued | | | | | | | | |
| and outstanding | | | 147,034 | | | | 147,034 | |
| Additional paid-in capital | | | 79,838,738 | | | | 79,689,720 | |
| Accumulated other comprehensive income (loss) | | | (31,345,975 | ) | | | (19,310,316 | ) |
| Retained earnings | | | 11,729,273 | | | | 7,504,590 | |
| Total stockholders' equity | | | 60,369,070 | | | | 68,031,028 | |
| | | $ | 235,817,602 | | | $ | 240,358,270 | |
GEORESOURCES, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
| | | | | | | |
| | | Three Months Ended March 31, | |
| | | 2008 | | | 2007 | |
| Revenue: | | | | | | |
| Oil and gas revenues | | $ | 22,462,739 | | | $ | 3,537,494 | |
| Partnership management fees | | | 312,474 | | | | 155,636 | |
| Property operating income | | | 314,271 | | | | 237,758 | |
| Gain on sale of property and equipment | | | 409,754 | | | | — | |
| Partnership income | | | 225,193 | | | | 59,746 | |
| Interest and other | | | 222,504 | | | | 126,923 | |
| | | | | | | | | |
| Total revenue | | | 23,946,935 | | | | 4,117,557 | |
| Expenses: | | | | | | | | |
| Lease operating expense | | | 5,791,117 | | | | 1,060,409 | |
| Severance taxes | | | 1,889,467 | | | | 268,942 | |
| Re-engineering and workovers | | | 697,163 | | | | 78,187 | |
| General and administrative expense | | | 1,783,588 | | | | 827,717 | |
| Depreciation, depletion and amortization | | | 3,876,949 | | | | 928,568 | |
| Hedge ineffectiveness | | | 1,518,355 | | | | 4,030 | |
| Interest | | | 1,569,175 | | | | 156,152 | |
| | | | | | | | | |
| Total expense | | | 17,125,814 | | | | 3,324,005 | |
| | | | | | | | | |
| Income before income taxes | | | 6,821,121 | | | | 793,552 | |
| Income taxes: | | | | | | | | |
| Current | | | 1,429,119 | | | | 1,862 | |
| Deferred | | | 1,167,319 | | | | 2,340 | |
| | | | | | | | | |
| | | | 2,596,438 | | | | 4,202 | |
| | | | | | | | | |
| Net income | | $ | 4,224,683 | | | $ | 789,350 | |
| | | | | | | | | |
| Net income per share (basic and diluted) | | $ | 0.29 | | | $ | 0.15 | |
| | | | | | | | | |
| Weighted average shares outstanding (basic and diluted) | | | 14,703,383 | | | | 5,378,893 | |
| | | | | | | | | |
