Georesources 8K Results of Operations and Financial Condition

Georesources (GEOI) Inactive 8-KResults of Operations and Financial Condition

______________________________________________________________________________

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): August 11, 2008

GEORESOURCES, INC.

(Exact name of registrant as specified in its charter)


COLORADO	0-8041	84-0505444

(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

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))

______________________________________________________________________________

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On August 11, 2008, GeoResources, Inc. issued a press release announcing financial results for the second quarter ended June 30, 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 August 11, 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.

Date: August 12, 2008

EXHIBIT INDEX


Exhibit No.		Description
99.9		GeoResources, Inc. Press Release dated August 11, 2008.

EXHIBIT 99.9

Contact: Cathy Kruse

Telephone: 701-572-2020 ext 113

cathyk@geoi.net

FOR IMMEDIATE RELEASE

GeoResources, Inc. Reports Second Quarter and

Six-Months Financial Results

Houston, Texas August 11, 2008 – GeoResources, Inc., (NASDAQ:GEOI), today announced its financial results for the first six-months and the quarter ended June 30, 2008, compared to the results for the same periods in 2007.

For the three months ended June 30, 2008, the Company reported net income of $7.8 million, or $0.50 per share (diluted) compared to a net loss of $1.3 million or $0.09 per share in 2007. Total revenue increased 240% to $28.2 million in the second quarter of 2008 compared to $8.3 million the same quarter in 2007.

For the first half of 2008, net income was $12.0 million, or $0.80 per share, on revenue of $52.2 million versus a net loss of $463,000, or $0.05 per share on revenue of $12.4 in the first half of 2007.

Oil and natural gas production increased substantially in the second quarter. Natural gas production increased to 719 MMcf from 361 MMcf, an increase of 99%. Oil production for the second quarter increased to 186 MBbls from 82 MBbls in the prior year’s period, an increase of 127%.

For the six months ended June 30, 2008, natural gas sales totaled 1,528 MMcf or 177% greater than the 552 MMcf sold during the first half of 2007. Oil sales for the first half of 2008 increased 204% to 386 Mbbls from 127 Mbbls in the first half of 2007.

The average realized price of natural gas was $9.74 per Mcf for the second quarter of 2008, 41% more than the second quarter of 2007. The average realized price of oil for the second quarter of 2008 was $97.66 per barrel or 75% more than the second quarter in the prior year.

The average realized price of natural gas was $8.68 per Mcf for the first half of 2008 or 31% more than the first half of the prior year. The average realized price of oil was $89.01 per barrel or 63% more for the first half of 2008 than the first six months in the prior year.

Earnings before interest, income taxes, depreciation, depletion and amortization, and exploration expense (“EBITDAX”) increased 581% to approximately $17.7 million for the second quarter 2008 compared to $2.6 million in the second quarter 2007. EBITDAX for the first six-months of 2008 increased 552% to approximately $30.0 million compared to $4.6 million in prior year’s first half.

The following tables reconcile reported net income to EBITDAX for the periods indicated (in thousands):

	Three Months Ended June 30,
	2008		2007


Net income (loss)	$	7,790	$	(1,349	)
Add back:
Interest expense		1,314		199
Income tax		4,546		1,849
Depreciation, depletion and amortization		3,573		1,932
Exploration and impairments		502		-

EBITDAX (1)	$	17,725	$	2,631

	Six Months Ended June 30,
	2008		2007


Net income (loss)	$	12,014	$	(463	)
Add back:
Interest expense		2,883		355
Income tax		7,142		1,854
Depreciation, depletion and amortization		7,450		2,861
Exploration and impairments		502		-

EBITDAX (1)	$	29,991	$	4,607

(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.

SemGroup Bankruptcy

Some investors have expressed concern about the possible impact on our Company of the recent bankruptcy filing by SemGroup LP and its subsidiary, SemCrude. SemCrude accounted for a very minor portion of our oil sales and we estimate that our maximum potential losses are approximately $100,000.

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
(In thousands, except share and per share amounts)
	June 30,			December 31,
	2008			2007
	(unaudited)
ASSETS
Current assets:
Cash	$	23,578		$	24,430
Accounts receivable:
Oil and gas revenues		32,472			20,365
Joint interest billings and other		4,287			3,913
Affiliated partnerships		4,162			3,360
Notes receivable		120			600
Federal income tax receivable		251			-
Prepaid expenses and other		2,250			1,430
Total current assets		67,120			54,098

Oil and gas properties, successful efforts method:
Proved properties		199,071			187,641
Unproved properties		3,520			5,140
Office and other equipment		989			996
Land		96			96
		203,676			193,873
Less accumulated depreciation, depletion and amortization		(18,106	)		(12,430	)
Net property and equipment		185,570			181,443
Other assets:
Equity in oil and gas limited partnerships		3,319			1,880
Deferred financing costs and other		2,695			2,937
	$	258,704		$	240,358
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	11,349		$	11,374
Accounts payable to affiliated partnerships		20,575			9,538
Revenues and royalties payable		21,164			14,567
Drilling advances		445			882
Accrued expenses		3,673			3,839
Derivative financial instruments		33,955			6,527
Total current liabilities		91,161			46,727

Long-term debt		50,000			96,000
Deferred income taxes		10,860			6,476
Asset retirement obligations		5,217			7,827
Derivative financial instruments		55,062			15,296
Stockholders' equity:
Common stock, par value $.01 per share; authorized
100,000,000 shares; 16,236,717 shares issued
and outstanding		162			147
Additional paid-in capital		112,290			79,690
Accumulated other comprehensive income (loss)		(85,567	)		(19,310	)
Retained earnings		19,519			7,505
Total stockholders' equity		46,404			68,032
	$	258,704		$	240,358

GEORESOURCES, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2008			2007			2008		2007

Revenue:
Oil and gas revenues	$	25,118		$	7,060		$	47,581	$	10,598
Partnership management fees		522			256			834		412
Property operating income		357			445			671		682
Gain (loss) on sale of property and equipment		1,551			(15	)		1,961		(15	)
Partnership income		429			154			655		213
Interest and other		228			385			450		512
Total revenue		28,205			8,285			52,152		12,402

Expenses:
Lease operating expense		5,789			2,255			11,580		3,315
Severance taxes		2,428			534			4,317		803
Re-engineering and workovers		984			415			1,682		433
Exploration and impairment expense		502			-			502		-
General and administrative expense		1,861			2,457			3,645		3,247
Depreciation, depletion and amortization		3,573			1,932			7,450		2,861
Hedge ineffectiveness		(582	)		(7	)		937		(3	)
Interest		1,314			199			2,883		355
Total expense		15,869			7,785			32,996		11,011

Income before income taxes		12,336			500			19,156		1,391

Income taxes:
Current		1,330			94			2,759		96
Deferred		3,216			1,755			4,383		1,758
		4,546			1,849			7,142		1,854

Net income (loss)	$	7,790		$	(1,349	)	$	12,014	$	(463	)

Net income per share (basic)	$	0.51		$	(0.09	)	$	0.80	$	(0.05	)

Net Income per share (diluted)	$	0.50		$	(0.09	)	$	0.79	$	(0.05	)


Weighted average shares outstanding (basic)		15,214			14,573			14,959		10,106

Weighted average shares outstanding (diluted)		15,505			14,573			15,146		10,106

GEORESOURCES, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
	Six Months Ended June 30,
	2008			2007
Cash flows from operating activities:
Net income	$	12,014		$	(463	)
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation, depletion and amortization		7,450			2,861
(Gain) loss on sale of property and equipment		(1,961	)		15
Impairment of unproved properties		483			-
Accretion of asset retirement obligations		216			53
Hedge ineffectiveness loss (gain)		937			(3	)
Partnership income		(655	)		(213	)
Partnership distributions		194			-
Deferred income taxes		4,383			1,758
Non-cash compensation		298			422
Changes in assets and liabilities:
Increase in accounts receivable		(13,534	)		(10,269	)
Decrease in notes receivable		480			-
Increase in prepaid expense and other		(623	)		344
Increase in accounts payable and accrued expenses		17,006			11,869
Net cash provided by operating activities		26,688			6,374
Cash flows from investing activities:
Proceeds from sale of property and equipment		20,432			1,750
Additions to property and equipment		(33,311	)		(10,143	)
Investment in oil and gas limited partnership		(978	)		(1,632	)
Net cash used in investing activities		(13,857	)		(10,025	)
Cash flows from financing activities:
Issuance of common stock, net of stock issue cost of $2,183,000		32,317			22,799
Distributions to stockholders		-			(4,006	)
Issuance of long-term debt		-			3,000
Reduction of long-term debt		(46,000	)		(9,800	)
Net cash provided by (used in) financing activities		(13,683	)		11,993

Net increase (decrease) in cash and cash equivalents		(852	)		8,342
Cash and cash equivalents at beginning of period		24,430			6,217
Cash and cash equivalents at end of period	$	23,578		$	14,559

Supplementary information:
Interest paid	$	2,831		$	332
Income taxes paid	$	4,210		$	-
Non-cash net asset acquire in merger transactions:
GeoResources	$	-		$	23,827
PICA Energy, LLC	$	-		$	11,703
Yuma property interests	$	-		$	3,120

GEORESOURCES, INC

/s/ Frank A. Lodzinski
Frank A. Lodzinski, President