Exhibit 99.1
| News Release |
THE BEARD COMPANY | |
Harvey Parkway | |
301 N.W. 63rd Street, Suite 400 | |
Oklahoma City, Oklahoma 73116 | |
For Immediate Release | |
THE BEARD COMPANY REPORTS
THIRD QUARTER AND NINE-MONTH OPERATING RESULTS
GEOHEDRAL LLC COMPLETING $2.5 MILLION EQUITY RAISE
TO FUND EXPLORATION ACTIVITIES
OKLAHOMA CITY, Oklahoma – November 23, 2009 - The Beard Company (OTCBB: BRCO) today reported net earnings of $3,713,000, or $0.18 per diluted share, for the nine months ended September 30, 2009, compared with net earnings of $2,072,000, or $0.10 per diluted share, in the corresponding period of the previous year. Revenues decreased 62% to $429,000 in the first nine months of 2009, versus $1,127,000 in the year-earlier period, reflecting the disposition of the Company’s interest in the McElmo Dome CO2 Field.
For the three months ended September 30, 2009, the Company reported a net loss of $1,137,000, or $0.06 per share, versus a net loss of $466,000, or $0.03 per share, in the third quarter of 2008. The per-share amounts have been adjusted to reflect a 2-for-1 stock split that was effective November 2, 2009. Revenues decreased 79% to $79,000 in the most recent quarter, versus $376,000 in the prior-year period, again reflecting the McElmo Dome sale.
Operating results for the first nine months of 2009 benefited from pre-tax gains of (i) $4,888,000 attributable to the sale of the Company’s remaining interest in the McElmo Dome CO2 Unit and (ii) $832,000 from the settlement of the Visa litigation. The first nine months of 2008 included a pre-tax gain of $3,338,000 from the sale of 35% of the Company’s interest in McElmo Dome. Minor losses on the sale of assets of $10,000 and $1,000 were recorded in the third quarters of 2009 and 2008, respectively. Operating results for the third quarter of 2009 were significantly impacted by (i) a $508,000 loss reflected in losses from unconsolidated affiliates, whereas the third quarter of 2008 quarter included only a $54,000 loss from unconsolidated affiliates; and (ii) a $149,000 impairment of investments and other assets. Included in the losses from unconsolidated affiliates were (i) losses of $21,000 from the Company’s investment in Beard Dilworth, LLC, an oil and gas venture in Oklahoma; (ii) losses of $498,000 from the Company’s investment in Geohedral LLC, a mining project in Alaska; and
(iii) $11,000 in earnings from the Company’s investment in another partnership. The $149,000 impairment reduced the Company’s investment in Geohedral to its share of the underlying equity in the partnership as of September 30, 2009.
Herb Mee, Jr., Beard’s President, stated, “Our investment in Geohedral LLC increased the Company’s third quarter loss by $647,000 due to SEC regulations governing mining operations that required the writedown of our investment in this subsidiary. In connection with Geohedral’s current $2.5 million equity offering, the Company invested $590,000 to maintain its 23.16% interest in Geohedral, and another $441,000 to increase its interest in the partnership to 25.68%. Proceeds of the equity offering were used to fund the staking and filing of Geohedral’s new mining claims in the Tanis Mesa area in southeastern Alaska that we announced on September 21 of this year. The funds were also utilized to defray the costs of drilling the holes, and sampling and assaying the results described in our September 21, 2009 news release.”
“Based on the value of investment interests sold by Geohedral in the equity offering that will be completed in early December, the Company’s 25.68% interest in Geohedral currently has an indicated fair market value of $4,499,000, versus a book value of $384,000 on our balance sheet at September 30, 2009. The current fair market value does not, in our opinion, adequately reflect the potential value of Beard’s 25.68% share of Geohedral’s mineral reserves, which we and Geohedral believe substantially exceeds the indicated fair market value of $4.5 million.”
“While our reported earnings and revenues have been sharply reduced as a result of the McElmo Dome sale, it is important to remember that our current results do not reflect the Company’s anticipated share of operating profits from the Dilworth Field, where water injection is slated to commence next month, and which is expected to make a significant contribution to our revenues and earnings beginning in the first quarter of 2010.”
About The Beard Company
The Beard Company has shifted its focus to three areas, all involving natural resources, that management believes have high growth and/or above-average profit potential. The Company is involved in oil and gas activities; coal reclamation activities; and minerals exploration and development through its Geohedral investment.
The Company is headquartered in Oklahoma City and its common stock trades on the OTC Bulletin Board under the symbol “BRCO”.
Forward-Looking Statements
This document may include statements that constitute “forward-looking” statements, usually containing the words “believe”, “estimate”, “project”, “expect”, “anticipate”, or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the Company’s lack of profitability in recent years; the ability to service outstanding debt and secure capital to fund operations; the ability to negotiate and execute contracts in connection with the Company’s coal reclamation activities; future trends in commodities prices; financial, potential geological or mechanical difficulties affecting Geohedral’s or Beard Dilworth’s planned activities;
uncertainties surrounding estimates of mineralized material; and other risks associated with the Company’s business. By making these forward-looking statements, Beard undertakes no obligation to update these statements for revisions or changes in the future.
For Additional Information, Please Contact:
Herb Mee, Jr., President, at (405) 842-2333 or via email at hmee@beardco.com
or
RJ Falkner & Company, Inc., Investor Relations Counsel, at (800) 377-9893 or via email at info@rjfalkner.com
THE BEARD COMPANY
Results of Operations
(Unaudited) |
| | | |
| For the Three Months
Ended September 30, | | For the None Months
Ended September 30, |
| 2009 | | 2008 | | 2009 | | 2008 |
| | | | | | | |
Revenues | $ 79,000 | | $ 376,000 | | $ 429,000 | | $ 1,127,000 |
Expenses | 557,000 | | 532,000 | | 1,522,000 | | 1,457,000 |
| | | | | | | |
Operating loss | (478,000) | | (156,000) | | (1,093,000) | | (330,000) |
Other income (expense). | (712,000) | | (222,000) | | 4,841,000 | | 2,720,000 |
| | | | | | | |
Earnings (loss) from continuing operations | | | | | | | |
before income taxes | (1,190,000) | | (378,000) | | 3,748,000 | | 2,390,000 |
Income tax benefit (expense) | 53,000 | | - | | (27,000) | | (25,000) |
| | | | | | | |
Earnings (loss) from continuing operations | (1,137,000) | | (378,000) | | 3,721,000 | | 2,365,000 |
| | | | | | | |
Loss from discontinued operations | - | | (232,000) | | - | | (723,000) |
| | | | | | | |
Net earnings (loss) | (1,137,000) | | (610,000) | | 3,721,000 | | 1,642,000 |
| | | | | | | |
Amounts attributable to noncontrolling interests | | | | | | |
(Income) loss from continuing operations | - | | - | | (8,000) | | 1,000 |
Loss from discontinued operations | - | | 144,000 | | - | | 429,000 |
| | | | | | | |
Net earnings (loss) attributable to | | | | | | | |
The Beard Company common shareholders | $ (1,137,000) | | $ (466,000) | | $ 3,713,000 | | $ 2,072,000 |
| | | | | | | |
Net earnings (loss) per average common share outstanding(1): | | | | | | |
Basic: | | | | | | | |
Earnings (loss) from continuing operations | $(0.06) | | $(0.02) | | $0.19 | | $ 0.18 |
Loss from discontinued operations | $ - | | $(0.01) | | $ - | | $(0.02) |
Net earnings (loss) | $(0.06) | | $(0.03) | | $0.19 | | $ 0.16 |
| | | | | | | |
Net earnings (loss) per average common share outstanding(1): | | | | | | |
Diluted: | | | | | | | |
Earnings (loss) from continuing operations | $(0.06) | | $(0.02) | | $0.18 | | $ 0.11 |
Loss from discontinued operations | $ - | | $(0.01) | | $ - | | $(0.01) |
Net earnings (loss) | $(0.06) | | $(0.03) | | $0.18 | | $ 0.10 |
| | | | | | | |
| | | | | | | |
Weighted average common shares outstanding(1): | | | | | | |
Basic | 19,827,000 | | 14,039,000 | | 19,817,000 | | 13,068,000 |
Diluted | 19,827,000 | | 14,039,000 | | 21,028,000 | | 20,884,000 |
_______ | | | | | | | |
| | | | | | | |
(1)All per share and common share amounts adjusted to reflect the 2-for-1 stock split effected November 2, 2009. |
THE BEARD COMPANY AND SUBSIDIARIES |
Balance Sheets |
September 30, 2009 (Unaudited) and December 31, 2008 |
| | | | | |
| | | September 30, | | December 31, |
| | Assets | 2009 | | 2008 |
| | | | | |
| | | | | |
Current assets: | | | |
| Cash and cash equivalents | $ 1,276,000 | | $ 182,000 |
| Accounts receivable, less allowance for doubtful | | | |
| receivables of $42,000 in 2009 and $31,000 in 2008 | 162,000 | | 185,000 |
| Prepaid expenses and other assets | 37,000 | | 5,000 |
| Assets of discontinued operations held for resale | 20,000 | | 26,000 |
| | Total current assets | 1,495,000 | | 398,000 |
| | | | | |
Restricted certificate of deposit | 50,000 | | 50,000 |
| | | | | |
Investments and other assets | 1,168,000 | | 87,000 |
| | | | | |
Property, plant and equipment, at cost | 2,074,000 | | 2,561,000 |
| Less accumulated depreciation, depletion and amortization | 1,100,000 | | 1,340,000 |
| | Net property, plant and equipment | 974,000 | | 1,221,000 |
| | | | | |
Intangible assets, at cost | 75,000 | | 75,000 |
| Less accumulated amortization | 70,000 | | 66,000 |
| | Net intangible assets | 5,000 | | 9,000 |
| | | | | |
| | | $ 3,692,000 | | $ 1,765,000 |
| | | | | |
| | | | | |
| | Liabilities and Shareholders' Equity (Deficiency) | | | |
| | | | | |
Current liabilities: | | | |
| Trade accounts payable | $90,000 | | $97,000 |
| Accrued expenses | 192,000 | | 431,000 |
| Short-term debt - related entities | - | | 57,000 |
| Current maturities of long-term debt | 45,000 | | 895,000 |
| Current maturities of long-term debt - related entities | - | | 390,000 |
| Liabilities of discontinued operations held for resale | 51,000 | | 65,000 |
| | Total current liabilities | 378,000 | | 1,935,000 |
| | | | | |
Long-term debt less current maturities | 397,000 | | 420,000 |
| | | | | |
Long-term debt - related entities | 2,002,000 | | 2,250,000 |
| | | | | |
Other long-term liabilities | 171,000 | | 172,000 |
| | | | | |
Shareholders' equity (deficiency): | | | |
| Convertible preferred stock of $100 stated value; | | | |
| 5,000,000 shares authorized; 27,838 shares issued | | | |
| and outstanding | 889,000 | | 889,000 |
| Common stock of $.00033325 par value per share; | | | |
| 30,000,000 authorized; 19,856,038 and 19,661,172 shares | | | |
| Issued and outstanding in 2009 and 2008, respectively | 7,000 | | 7,000 |
| Capital in excess of par value | 42,698,000 | | 42,655,000 |
| Accumulated deficit | (40,265,000) | | (43,978,000) |
| Accumulated other comprehensive income | 24,000 | | 25,000 |
| | Total shareholders' equity (deficiency) attributable to
The Beard Company | 3,353,000 | | (402,000) |
| | | | | |
| Noncontrolling interests | (2,609,000) | | (2,610,000) |
| | Total shareholders' equity (deficiency) | 744,000 | | (3,012,000) |
| | | | | |
Commitments and contingencies (note 8) | | | |
| | | $ 3,692,000 | | $ 1,765,000 |
| | | | | |
See accompanying notes to financial statements. | | | |
