HARVEST NATURAL RESOURCES CORRECTS
2005 FIRST QUARTER RESULTS
HOUSTON, Texas (April 29, 2005) – Harvest Natural Resources, Inc. (NYSE: HNR) today announced it has increased its 2005 first quarter earnings $774,000, or $0.02 per diluted share, to $18.0 million, or $0.47 per diluted share. The change is due to the recognition of an additional pre-tax $1,663,000 foreign exchange gain resulting from the March 3, 2005 exchange rate adjustment in Venezuela from 1,910 Bolivars per dollar to 2,150 Bolivars per dollar. The Company previously announced 2005 first quarter earnings of $17.3 million, or $0.45 per diluted share.
Harvest Natural Resources, Inc., headquartered in Houston, Texas, is an independent oil and gas development and production company with principal operations in Venezuela and an office in Russia. For more information visit the Company’s website atwww.harvestnr.com.
CONTACT: | ||
Steven W. Tholen Senior Vice President, Chief Financial Officer (281) 899-5714 | Amanda M. Koenig Investor Relations (281) 899-5716 |
“This press release may contain projections and other forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts may constitute forward-looking statements. Although Harvest believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Actual results may differ materially from Harvest’s expectations as a result of factors discussed in Harvest’s 2004 Annual Report on Form 10-K and subsequent reports.”
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HARVEST NATURAL RESOURCES, INC.
CONSOLIDATED BALANCE SHEETS
($ millions, unaudited)
March 31, 2005 | December 31, 2004 | |||||||||||||||||||||||
ASSETS: | ||||||||||||||||||||||||
CURRENT ASSETS: | ||||||||||||||||||||||||
Cash and equivalents | $ | 103.2 | $ | 84.6 | ||||||||||||||||||||
Accounts receivable, net | 76.7 | 71.7 | ||||||||||||||||||||||
Commodity hedging contract | 1.4 | 14.2 | ||||||||||||||||||||||
Current deferred tax asset | 3.4 | 0.3 | ||||||||||||||||||||||
Prepaid expenses and other | 2.2 | 1.4 | ||||||||||||||||||||||
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Total current assets | 186.9 | 172.2 | ||||||||||||||||||||||
OTHER ASSETS | 3.2 | 2.1 | ||||||||||||||||||||||
DEFERRED INCOME TAXES | 6.0 | 6.0 | ||||||||||||||||||||||
PROPERTY AND EQUIPMENT, net | 182.0 | 187.1 | ||||||||||||||||||||||
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| TOTAL ASSETS | $ | 378.1 | $ | 367.4 | |||||||||||||||||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY: | ||||||||||||||||||||||||
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CURRENT LIABILITIES: | ||||||||||||||||||||||||
Accounts payable, trade and other | $ | 4.7 | $ | 8.4 | ||||||||||||||||||||
Accounts payable, related party | 9.1 | 11.1 | ||||||||||||||||||||||
Accrued expenses | 21.0 | 29.4 | ||||||||||||||||||||||
Income taxes payable | 30.1 | 22.5 | ||||||||||||||||||||||
Current portion of long-term debt | 10.5 | 11.8 | ||||||||||||||||||||||
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Total current liabilities | 75.4 | 83.2 | ||||||||||||||||||||||
LONG TERM DEBT | - | - | ||||||||||||||||||||||
ASSET RETIREMENT PROVISION | 2.0 | 1.9 | ||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | - | - | ||||||||||||||||||||||
MINORITY INTEREST | 44.3 | 39.1 | ||||||||||||||||||||||
STOCKHOLDERS’ EQUITY: | ||||||||||||||||||||||||
Common stock and paid-in capital | 186.7 | 185.6 | ||||||||||||||||||||||
Retained earnings | 80.0 | 61.9 | ||||||||||||||||||||||
Accumulated other comprehensive loss | (6.5 | ) | (0.5 | ) | ||||||||||||||||||||
Treasury stock | (3.8 | ) | (3.8 | ) | ||||||||||||||||||||
Total stockholders’ equity | 256.4 | 243.2 | ||||||||||||||||||||||
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 378.1 | $ | 367.4 | ||||||||||||||||||||
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HARVEST NATURAL RESOURCES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per BOE and per share amounts, unaudited)
THREE MONTHS ENDED: | March 31, 2005 | March 31, 2004 | ||||||||||||||
Barrels of oil sold | 2,530 | 1,914 | ||||||||||||||
MMCF of gas sold | 7,267 | 7,757 | ||||||||||||||
Total BOE | 3,741 | 3,207 | ||||||||||||||
Average price/barrel | $ | 21.15 | $ | 16.10 | ||||||||||||
Average price/mcf | $ | 1.03 | $ | 1.03 | ||||||||||||
$ | $/BOE | $ | $/BOE | |||||||||||||
REVENUES: | ||||||||||||||||
Oil sales | $ | 53,501 | $ | 30,808 | ||||||||||||
Gas sales | 7,485 | 7,989 | ||||||||||||||
60,986 | 16.30 | 38,797 | 12.10 | |||||||||||||
EXPENSES: | ||||||||||||||||
Operating expenses | 8,888 | 2.38 | 7,339 | 2.29 | ||||||||||||
Depletion and amortization | 11,170 | 2.99 | 7,723 | 2.41 | ||||||||||||
Depreciation | 499 | 0.13 | 438 | 0.14 | ||||||||||||
General and administrative | 5,022 | 1.34 | 3,635 | 1.13 | ||||||||||||
Taxes other than on income | 1,721 | 0.46 | 1,194 | 0.37 | ||||||||||||
27,300 | 7.30 | 20,329 | 6.34 | |||||||||||||
INCOME FROM OPERATIONS | 33,686 | 9.00 | 18,468 | 5.76 | ||||||||||||
OTHER NON-OPERATING INCOME (EXPENSE) | ||||||||||||||||
Investment earnings and other | 539 | 0.14 | 303 | 0.09 | ||||||||||||
Interest expense | (242 | ) | (0.06 | ) | (2,489 | ) | (0.78 | ) | ||||||||
Net gain (loss) on exchange rates | 2,757 | 0.74 | (609 | ) | (0.19 | ) | ||||||||||
3,054 | 0.82 | (2,795 | ) | (0.88 | ) | |||||||||||
INCOME BEFORE INCOME TAXES AND MINORITY | ||||||||||||||||
INTERESTS | 36,740 | 9.82 | 15,673 | 4.88 | ||||||||||||
Income tax expense | 13,533 | 3.62 | 5,600 | 1.75 | ||||||||||||
INCOME BEFORE MINORITY INTERESTS | 23,207 | 6.20 | 10,073 | 3.13 | ||||||||||||
Minority interest in consolidated subsidiary companies | 5,172 | 1.38 | 2,566 | 0.80 | ||||||||||||
NET INCOME | 18,035 | 4.82 | 7,507 | 2.33 | ||||||||||||
NET INCOME PER COMMON SHARE: | ||||||||||||||||
Basic | $ | 0.49 | $ | 0.21 | ||||||||||||
Diluted | $ | 0.47 | $ | 0.20 | ||||||||||||
Weighted average shares outstanding: | ||||||||||||||||
Basic | 36.8 | million | 35.8 | million | ||||||||||||
Diluted | 38.6 | million | 37.9 | million | ||||||||||||
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HARVEST NATURAL RESOURCES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands, unaudited)
Three Months Ended March 31, | ||||||||||||||||
2005 | 2004 | |||||||||||||||
Cash Flows From Operating Activities: | ||||||||||||||||
Net income | $ | 18,035 | $ | 7,507 | ||||||||||||
Adjustments to reconcile net income to net cash | ||||||||||||||||
provided by operating activities: | ||||||||||||||||
Depletion, depreciation and amortization | 11,669 | 8,161 | ||||||||||||||
Amortization of financing costs | — | 76 | ||||||||||||||
Deferred compensation expense | (448 | ) | — | |||||||||||||
Non-cash compensation related charges | 856 | 96 | ||||||||||||||
Minority interest in consolidated subsidiary | ||||||||||||||||
companies | 5,172 | 2,566 | ||||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||
Accounts and notes receivable | (5,014 | ) | (5,903 | ) | ||||||||||||
Prepaid expenses and other | (834 | ) | (586 | ) | ||||||||||||
Commodity hedging contract | 3,686 | — | ||||||||||||||
Accounts payable | (3,703 | ) | (2,639 | ) | ||||||||||||
Accounts payable, related party | (1,952 | ) | 256 | |||||||||||||
Accrued expenses | (7,969 | ) | (2,861 | ) | ||||||||||||
Provision for asset retirements | 54 | — | ||||||||||||||
Income taxes payable | 7,573 | 1,577 | ||||||||||||||
Net Cash Provided By Operating Activities | 27,125 | 10,231 | ||||||||||||||
Cash Flows From Investing Activities: | ||||||||||||||||
Additions of property and equipment | (6,515 | ) | (743 | ) | ||||||||||||
Investment costs | (1,104 | ) | (573 | ) | ||||||||||||
Net Cash Used In Investing Activities | (7,619 | ) | (1,316 | ) | ||||||||||||
Cash Flows From Financing Activities: | ||||||||||||||||
Net proceeds from issuances of common stock | 358 | 1,256 | ||||||||||||||
Payments on long-term debt | (1,291 | ) | (1,592 | ) | ||||||||||||
Net Cash Used In Financing Activities | (933 | ) | (336 | ) | ||||||||||||
Net Increase in Cash | 18,573 | 8,579 | ||||||||||||||
Cash and Cash Equivalents at Beginning of Period | 84,600 | 138,660 | ||||||||||||||
Cash and Cash Equivalents at End of Period | $ | 103,173 | $ | 147,239 | ||||||||||||
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