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PHX MINERALS INC. REPORTS SECOND FISCAL QUARTER 2022 RESULTS, RECORD ROYALTY VOLUMES AND A QUARTERLY DIVIDEND INCREASE OF 33%

PHX MINERALS INC. REPORTS SECOND FISCAL QUARTER 2022 RESULTS, RECORD ROYALTY VOLUMES AND A QUARTERLY DIVIDEND INCREASE OF 33%

PHX MINERALS INC.

REPORTS SECOND FISCAL QUARTER 2022 RESULTS, RECORD ROYALTY VOLUMES AND A QUARTERLY DIVIDEND INCREASE OF 33%

OKLAHOMA CITY, May 9, 2022 – PHX MINERALS INC., “PHX” or the “Company” (NYSE: PHX), today reported financial and operating results for the second fiscal quarter ended March 31, 2022.

SUMMARY OF RESULTS FOR THE PERIOD ENDED MARCH 31, 2022, AND SUBSEQUENT EVENTS

  • Royalty production volumes for the second fiscal quarter of 2022 increased 26% to a record 1,548 Mmcfe, and total production volumes for the second fiscal quarter of 2022 increased 16% to 2,460 Mmcfe compared to the first fiscal quarter of 2022.
  • 82% of royalty production volumes and 78% of total production volumes in the second fiscal quarter of 2022 were attributable to natural gas.
  • 108 gross (0.48 net) wells converted to PDP, including 35 gross (0.04 net) in the SCOOP and 31 gross (0.33 net) in the Haynesville, during the second fiscal quarter of 2022.
  • 134 gross (0.60 net) wells in progress as of March 31, 2022.
  • Net loss in the second fiscal quarter of 2022 was ($4.0) million, or ($0.12) per share, compared to net income of $6.7 million, or $0.20 per share, in the first fiscal quarter of 2022.
  • Pretax net income excluding non-cash derivative gains (losses) (1) in the second fiscal quarter of 2022 was $7.8 million, or $0.23 per share, compared to $2.9 million, or $0.09 per share, in the first fiscal quarter of 2022.
  • Adjusted EBITDA(1) of $5.8 million for the second fiscal quarter of 2022, increased from $3.6 million in the second fiscal quarter of 2021 and from $4.4 million in the first fiscal quarter of 2022.
  • Total debt as of March 31, 2022, equaled $24.0 million and debt to adjusted EBITDA (TTM) (1) ratio was 1.23x at March 31, 2022.
  • During the second quarter of fiscal year 2022, PHX closed on an acquisition of 825 net royalty acres located in the SCOOP play of Oklahoma and the Haynesville play of East Texas and Louisiana for approximately $9.3 million in cash.
  • Since March 31, 2022, PHX has closed on an additional acquisition of 185 net royalty acres located in the SCOOP play of Oklahoma and the Haynesville play of Louisiana for approximately $1.5 million in cash. PHX has an additional 983 net royalty acres pending acquisition and under purchase and sale agreements, which the Company expects to close by the end of May 2022 for approximately $9.4 million in cash.
  • PHX announced that the quarterly dividend increased to $0.02 per share, a 33% increase, payable on June 3, 2022, to stockholders of record on May 19, 2022.
  1. This is a non-GAAP measure. Refer to the Non-GAAP Reconciliation section.

Chad L. Stephens, President and CEO, commented, “We are very pleased to report excellent financial results for our second quarter. First, I would like to recognize our employees for their dedication and hard work, for they are our greatest resource. None of our accomplishments would have been achieved without them.

“Royalty volumes increased by over 20% on a quarter over quarter basis for the second consecutive quarter to a record 1.55 Bcfe, and non-operated working interest volumes continue to decline as a percentage of total volumes to 37% and will continue to become less material going forward.  Higher sales volumes along with the serendipitous commodity price environment provided a 32% increase quarter over sequential quarter in adjusted EBITDA.

“Our active mineral acquisition program has closed a year-to-date total of $25.6 million in transactions with another $9.4 million scheduled to close by the end of May – all in our core focus areas in the SCOOP of southern Oklahoma and the Haynesville. These recent acquisitions are in areas of active drilling and will drive our increasing royalty volumes and cash flow over the coming quarters. Additionally, the Board approved a 33% increase in our quarterly dividend payable in June 2022, which highlights our confidence in our financial strength and earnings power of our growing asset base. PHX remains committed to increasing our return of capital to stockholders via future dividends as we grow our asset base.”

OPERATING HIGHLIGHTS

 

Second Quarter Ended

 

 

Second Quarter Ended

 

 

Six Months Ended

 

 

Six Months Ended

 

 

March 31, 2022

 

 

March 31, 2021

 

 

March 31, 2022

 

 

March 31, 2021

 

Mcfe Sold

 

2,460,042

 

 

 

2,296,802

 

 

 

4,588,290

 

 

 

4,371,139

 

Average Sales Price per Mcfe

$

6.01

 

 

$

3.63

 

 

$

6.21

 

 

$

3.38

 

Gas Mcf Sold

 

1,908,030

 

 

 

1,735,820

 

 

 

3,482,295

 

 

 

3,211,276

 

Average Sales Price per Mcf

$

4.47

 

 

$

2.52

 

 

$

4.95

 

 

$

2.44

 

Oil Barrels Sold

 

51,631

 

 

 

56,269

 

 

 

99,705

 

 

 

114,945

 

Average Sales Price per Barrel

$

91.26

 

 

$

55.89

 

 

$

83.12

 

 

$

47.73

 

NGL Barrels Sold

 

40,371

 

 

 

37,228

 

 

 

84,627

 

 

 

78,365

 

Average Sales Price per Barrel

$

38.05

 

 

$

22.24

 

 

$

34.94

 

 

$

18.54

 

 

 

Total Production for the last five quarters was as follows:

Quarter ended

 

Mcf Sold

 

 

Oil Bbls Sold

 

 

NGL Bbls Sold

 

 

Mcfe Sold

 

3/31/2022

 

 

1,908,030

 

 

 

51,631

 

 

 

40,371

 

 

 

2,460,042

 

12/31/2021

 

 

1,574,265

 

 

 

48,074

 

 

 

44,256

 

 

 

2,128,248

 

9/30/2021

 

 

1,609,101

 

 

 

54,043

 

 

 

46,369

 

 

 

2,211,570

 

6/30/2021

 

 

1,879,343

 

 

 

55,492

 

 

 

46,753

 

 

 

2,492,813

 

3/31/2021

 

 

1,735,820

 

 

 

56,269

 

 

 

37,228

 

 

 

2,296,802

 

 

 

Royalty Interest Production for the last five quarters was as follows:

 

Quarter ended

 

Mcf Sold

 

 

Oil Bbls Sold

 

 

NGL Bbls Sold

 

 

Mcfe Sold

 

3/31/2022

 

 

1,261,949

 

 

 

28,758

 

 

 

18,852

 

 

 

1,547,609

 

12/31/2021

 

 

949,523

 

 

 

25,996

 

 

 

19,953

 

 

 

1,225,220

 

9/30/2021

 

 

705,397

 

 

 

29,442

 

 

 

19,364

 

 

 

998,230

 

6/30/2021

 

 

908,471

 

 

 

31,095

 

 

 

18,255

 

 

 

1,204,571

 

3/31/2021

 

 

924,969

 

 

 

31,768

 

 

 

19,088

 

 

 

1,230,105

 

Working Interest Production for the last five quarters was as follows:

Quarter ended

 

Mcf Sold

 

 

Oil Bbls Sold

 

 

NGL Bbls Sold

 

 

Mcfe Sold

 

3/31/2022

 

 

646,081

 

 

 

22,873

 

 

 

21,519

 

 

 

912,433

 

12/31/2021

 

 

624,742

 

 

 

22,078

 

 

 

24,303

 

 

 

903,028

 

9/30/2021

 

 

903,704

 

 

 

24,601

 

 

 

27,005

 

 

 

1,213,340

 

6/30/2021

 

 

970,872

 

 

 

24,397

 

 

 

28,498

 

 

 

1,288,242

 

3/31/2021

 

 

810,851

 

 

 

24,501

 

 

 

18,140

 

 

 

1,066,697

 

 

FINANCIAL HIGHLIGHTS

 

 

Second Quarter Ended

 

 

Second Quarter Ended

 

 

Six Months Ended

 

 

Six Months Ended

 

 

 

March 31, 2022

 

 

March 31, 2021

 

 

March 31, 2022

 

 

March 31, 2021

 

Working Interest Sales

 

$

5,904,871

 

 

$

3,851,478

 

 

$

11,871,518

 

 

$

7,759,002

 

Royalty Interest Sales

 

$

8,878,994

 

 

$

4,494,347

 

 

$

16,599,511

 

 

$

7,011,802

 

Natural Gas, Oil and NGL Sales

 

$

14,783,865

 

 

$

8,345,825

 

 

$

28,471,029

 

 

$

14,770,804

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease Bonuses and Rental Income

 

$

161,908

 

 

$

58,554

 

 

$

240,823

 

 

$

59,987

 

Total Revenue

 

$

1,962,367

 

 

$

6,056,236

 

 

$

18,564,614

 

 

$

12,228,612

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOE per Working Interest Mcfe

 

$

1.02

 

 

$

0.97

 

 

$

1.20

 

 

$

0.85

 

LOE per total Mcfe

 

$

0.38

 

 

$

0.45

 

 

$

0.48

 

 

$

0.47

 

Transportation, Gathering and Marketing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

per Mcfe

 

$

0.61

 

 

$

0.57

 

 

$

0.59

 

 

$

0.59

 

Production Tax per Mcfe

 

$

0.28

 

 

$

0.19

 

 

$

0.30

 

 

$

0.16

 

Cash G&A Expense per Mcfe (1)

 

$

0.93

 

 

$

0.80

 

 

$

0.88

 

 

$

0.78

 

G&A Expense per Mcfe

 

$

1.12

 

 

$

0.90

 

 

$

1.05

 

 

$

0.87

 

Interest Expense per Mcfe

 

$

0.09

 

 

$

0.12

 

 

$

0.09

 

 

$

0.13

 

DD&A per Mcfe

 

$

0.86

 

 

$

0.77

 

 

$

0.81

 

 

$

0.92

 

Total Expense per Mcfe

 

$

3.34

 

 

$

3.00

 

 

$

3.32

 

 

$

3.14

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

 

$

(4,020,455

)

 

$

(499,723

)

 

$

2,661,794

 

 

$

(1,096,443

)

Adjusted EBITDA (2)

 

$

5,819,415

 

 

$

3,582,486

 

 

$

10,235,479

 

 

$

6,494,198

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash Flow from Operations

 

$

7,296,330

 

 

$

4,205,726

 

 

$

15,934,320

 

 

$

4,677,107

 

CapEx

 

$

86,671

 

 

$

297,015

 

 

$

279,348

 

 

$

425,098

 

CapEx - Mineral Acquisitions

 

$

9,274,447

 

 

$

64,758

 

 

$

20,918,274

 

 

$

7,934,504

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowing Base

 

 

 

 

 

 

 

 

 

$

32,000,000

 

 

$

29,400,000

 

Debt

 

 

 

 

 

 

 

 

 

$

24,000,000

 

 

$

23,500,000

 

Debt to Adjusted EBITDA (TTM) (2)

 

 

 

 

 

 

 

 

 

 

1.23

 

 

 

2.35

 

  1. G&A excluding restricted stock and deferred director’s expense.
  2. This is a non-GAAP measure. Refer to the Non-GAAP Reconciliation section.

SECOND FISCAL QUARTER ENDED MARCH 31, 2022, RESULTS

The Company recorded a second fiscal quarter 2022 net loss of ($4,020,455), or ($0.12) per share, as compared to a net loss of ($499,723), or ($0.02) per share, in the second fiscal quarter 2021. The change in net loss was principally the result of unrealized losses associated with the Company’s derivative contracts, offset by increased natural gas, oil and NGL sales and gains on asset sales.

Natural gas, oil and NGL revenue increased $6,438,040, or 77%, for the second quarter 2022, compared to the corresponding 2021 quarter due to increases in natural gas, oil and NGL prices of 77%, 63% and 71%, respectively, and an increase in natural gas and NGL volumes of 10% and 8%, respectively, partially offset by an 8% decrease in oil volumes.

The production increase in royalty volumes during the three months ended March 31, 2022, as compared to the three months ended March 31, 2021, resulted from acquired wells in the Haynesville Shale and SCOOP plays coming online.  The decrease in working interest volumes resulted from naturally declining production in high-interest wells in the Arkoma Stack and the divestiture of low-value legacy working interests in Oklahoma.

The Company had a net loss on derivative contracts of ($12,983,406) in the second fiscal 2022 quarter, as compared to a net loss of ($2,348,143) in the second fiscal 2021 quarter, of which ($11,772,640) is unrealized with respect to the second fiscal 2022 quarter. Realized net loss on derivative contracts for the second fiscal 2022 quarter excludes $2,493,481 of cash paid to settle off-market derivative contracts. The change in net loss on derivative contracts was principally due to the Company’s natural gas and oil collars and fixed price swaps being less beneficial in the quarter ended March 31, 2022, in relation to their respective contracted volumes and prices, as compared to the corresponding 2021 quarter.

The 11% increase in total cost per Mcfe in the second fiscal 2022 quarter, relative to the second fiscal 2021 quarter, was primarily driven by an increase in general and administrative costs, or G&A, and depreciation, depletion and amortization, or DD&A. G&A increased $684,788, or 33%, in the second fiscal 2022 quarter compared to the corresponding 2021 quarter due to legal expenses associated with reincorporating in the state of Delaware, increased transaction activity and restricted stock expense. DD&A increased $343,299, or 19%, in the second fiscal 2022 quarter to $0.86 per Mcfe, as compared to $0.77 per Mcfe in the second fiscal 2021 quarter. Of the DD&A increase, $217,604 was a result of a $0.09 increase in the DD&A rate per Mcfe, and $125,695 of such increase resulted from production increasing 7% in the second fiscal 2022 quarter.

SIX MONTHS ENDED MARCH 31, 2022, RESULTS

The Company recorded net income of $2,661,794, or $0.08 per share, in the fiscal six-month period ended March 31, 2022 (the “fiscal six-month 2022 period”), as compared to a net loss of ($1,096,443), or ($0.05) per share, in the corresponding 2021 period. The change in net income was principally the result of increased natural gas, oil and NGL sales and lease bonuses and rental income, and decreased DD&A and interest expense, partially offset by an increase in losses on derivative contracts, lease operating expense, or LOE, transportation, gathering and marketing expenses, production taxes and a reduction in income tax benefit.

Natural gas, oil and NGL sales increased $13,700,225, or 93%, for the fiscal six-month 2022 period, compared to the corresponding 2021 period, due to increases in natural gas, oil and NGL prices of 103%, 74% and 88%, respectively, and an increase in natural gas and NGL volumes of 8% and 8%, respectively, partially offset by a decrease in oil volumes of 13%.

Natural gas volumes increased during the fiscal six-month 2022 period, as compared to the corresponding 2021 period, primarily as a result of new wells associated with recent acquisitions in the Haynesville Shale and SCOOP plays coming online. These gas volumes were partially offset by naturally declining production in high-interest wells in the Arkoma Stack and divestitures in the Fayetteville.  NGL production also increased as a result of new wells brought online in the SCOOP, as well as increased production from liquids-rich gas wells in the Anadarko Granite Wash. The decrease in oil production was a result of naturally declining production in working interest wells in the Eagle Ford play and royalty wells in the Bakken play, due to the Company’s strategy of no longer participating with working interests in new drilling in the Eagle Ford, and reduced drilling activity in the Bakken, as well as naturally declining production in high-interest wells brought online in the STACK during fiscal year 2021. Oil production decreases were partially offset by new wells in the SCOOP.

The Company had a net loss on derivative contracts of ($10,147,238) in the fiscal six-month 2022 period, as compared to a net loss of ($2,602,179) in the corresponding 2021 period, of which ($7,222,140) is unrealized with respect to the fiscal six-month 2022 period. Realized net loss on derivative contracts for the fiscal six-month 2022 period excludes $5,181,572 of cash paid to settle off-market derivative contracts. The change in net loss on derivative contracts was principally due to the Company’s natural gas and oil collars and fixed price swaps being less beneficial in the fiscal six-month 2022 period in relation to their respective contracted volumes and prices, as compared to the corresponding 2021 period.

The 6% increase in total cost per Mcfe in the fiscal six-month 2022 period, relative to the corresponding 2021 period, was primarily driven by an increase in G&A and production tax, partially offset by a decrease in DD&A. G&A increased $1,049,248, or 28%, in the fiscal six-month 2022 period compared to the corresponding 2021 period due to legal expenses associated with reincorporating in the state of Delaware, increased transaction activity and restricted stock expense. DD&A decreased $333,590, or 8%, in the fiscal six-month 2022 period to $0.81 per Mcfe, as compared to $0.92 per Mcfe in the corresponding 2021 period. Of the DD&A decrease, $533,366 was a result of a $0.11 decrease in the DD&A rate per Mcfe, partially offset by an increase of $199,776 resulting from production increasing 5% in the fiscal six-month 2022 period compared to the corresponding 2021 period. The DD&A rate per Mcfe decrease was mainly due an increase in reserves during the fiscal six-month 2022 period, as compared to the corresponding 2021 period.

OPERATIONS UPDATE

During the second fiscal quarter of 2022, the Company converted 108 gross (0.48 net) wells to producing status, including 35 gross (0.04 net) in the SCOOP and 31 gross (0.33 net) in the Haynesville.

At March 31, 2022, the Company had a total of 134 gross wells (0.60 net wells) in progress across its mineral positions and 52 gross (0.23 net) active permitted wells. As of March 31, 2022, 18 rigs were operating on the Company’s acreage with 86 rigs operating within 2.5 miles of its acreage.

 

 

 

 

 

 

 

 

 

 

Bakken/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three

 

 

Arkoma

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SCOOP

 

 

STACK

 

 

Forks

 

 

Stack

 

 

Fayetteville

 

 

Haynesville

 

 

Other

 

 

Total

 

As of March 31, 2022:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Gross Wells in Progress on PHX Acreage

 

 

61

 

 

 

14

 

 

 

6

 

 

 

6

 

 

 

-

 

 

 

40

 

 

 

7

 

 

 

134

 

  Net Wells in Progress on PHX Acreage

 

 

0.17

 

 

 

0.07

 

 

 

0.01

 

 

 

0.00

 

 

 

-

 

 

 

0.33

 

 

 

0.02

 

 

 

0.60

 

  Gross Active Permits on PHX Acreage

 

 

10

 

 

 

11

 

 

 

11

 

 

 

4

 

 

 

-

 

 

 

12

 

 

 

4

 

 

 

52

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 2022:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rigs Present on PHX Acreage

 

 

7

 

 

 

1

 

 

 

1

 

 

 

1

 

 

 

-

 

 

 

7

 

 

 

1

 

 

 

18

 

Rigs Within 2.5 Miles of PHX Acreage

 

 

19

 

 

 

13

 

 

 

10

 

 

 

2

 

 

 

-

 

 

 

29

 

 

 

13

 

 

 

86

 

Leasing Activity

During the second quarter of fiscal 2022, the Company leased 385 net mineral acres for an average bonus payment of $942 per net mineral acre and an average royalty of 22%.

 

 

 

 

 

 

 

 

 

 

Bakken/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three

 

 

Arkoma

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SCOOP

 

 

STACK

 

 

Forks

 

 

Stack

 

 

Fayetteville

 

 

Haynesville

 

 

Other

 

 

Total

 

During Three Months Ended March 31, 2022:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Mineral Acres Leased

 

 

41

 

 

 

67

 

 

 

-

 

 

 

125

 

 

 

9

 

 

 

-

 

 

 

143

 

 

 

385

 

Average Bonus per Net Mineral Acre

 

$

1,679

 

 

$

1,000

 

 

 

-

 

 

$

185

 

 

$

100

 

 

 

-

 

 

$

467

 

 

$

942

 

Average Royalty per Net Mineral Acre

 

25%

 

 

25%

 

 

 

-

 

 

19%

 

 

$

17

 

 

 

-

 

 

19%

 

 

22%

 

 

ACQUISITION AND DIVESTITURE UPDATE

During the second quarter of fiscal year 2022, the Company purchased 825 net royalty acres for approximately $9.3 million and sold 7,208 net mineral acres, which were predominantly undeveloped and unleased, for approximately $2.1 million.

 

 

 

 

 

 

 

 

 

 

Bakken/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three

 

 

Arkoma

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SCOOP

 

 

STACK

 

 

Forks

 

 

Stack

 

 

Fayetteville

 

 

Haynesville

 

 

Other

 

 

Total

 

During Three Months Ended March 31, 2022:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Mineral Acres Purchased

 

 

184

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

421

 

 

 

-

 

 

 

605

 

Net Royalty Acres Purchased

 

 

224

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

601

 

 

 

-

 

 

 

825

 

Price per Net Royalty Acre

 

$

8,027

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

$

12,511

 

 

 

-

 

 

$

11,294

 

Net Mineral Acres Sold

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

7,208

 

 

 

7,208

 

Net Royalty Acres Sold

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

7,708

 

 

 

7,708

 

Price per Net Royalty Acre

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

$

272

 

 

$

272

 

 

SECOND QUARTER EARNINGS CALL

PHX will host a conference call to discuss the Company’s second fiscal quarter results at 11:00 a.m. EST tomorrow May 10, 2022. Management’s discussion will be followed by a question and answer session with investors. To participate on the conference call, please dial 877-407-3088 (domestic) or 201-389-0927 (international). A replay of the call will be available for 14 days after the call. The number to access the replay of the conference call is 877-660-6853 and the PIN for the replay is 13729283.

 

 

FINANCIAL RESULTS

Statements of Operations

 

Three Months Ended March 31,

 

 

Six Months Ended March 31,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenues:

 

 

 

 

 

Natural gas, oil and NGL sales

$

14,783,865

 

 

$

8,345,825

 

 

$

28,471,029

 

 

$

14,770,804

 

Lease bonuses and rental income

 

161,908

 

 

 

58,554

 

 

 

240,823

 

 

 

59,987

 

Gains (losses) on derivative contracts

 

(12,983,406

)

 

 

(2,348,143

)

 

 

(10,147,238

)

 

 

(2,602,179

)

 

 

1,962,367

 

 

 

6,056,236

 

 

 

18,564,614

 

 

 

12,228,612

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease operating expenses

 

929,454

 

 

 

1,030,651

 

 

 

2,185,465

 

 

 

2,035,063

 

Transportation, gathering and marketing

 

1,488,518

 

 

 

1,319,514

 

 

 

2,702,122

 

 

 

2,600,479

 

Production taxes

 

697,393

 

 

 

443,154

 

 

 

1,376,340

 

 

 

719,180

 

Depreciation, depletion and amortization

 

2,121,116

 

 

 

1,777,817

 

 

 

3,704,876

 

 

 

4,038,466

 

Provision for impairment

 

-

 

 

 

-

 

 

 

5,585

 

 

 

-

 

Interest expense

 

230,212

 

 

 

267,865

 

 

 

406,931

 

 

 

569,763

 

General and administrative

 

2,744,264

 

 

 

2,059,476

 

 

 

4,839,821

 

 

 

3,790,573

 

Losses (gains) on asset sales and other

 

(2,261,135

)

 

 

(125,518

)

 

 

(113,320

)

 

 

(142,469

)

Total costs and expenses

 

5,949,822

 

 

 

6,772,959

 

 

 

15,107,820

 

 

 

13,611,055

 

Income (loss) before provision (benefit) for income taxes

 

(3,987,455

)

 

 

(716,723

)

 

 

3,456,794

 

 

 

(1,382,443

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision (benefit) for income taxes

 

33,000

 

 

 

(217,000

)

 

 

795,000

 

 

 

(286,000

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

(4,020,455

)

 

$

(499,723

)

 

$

2,661,794

 

 

$

(1,096,443

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted earnings (loss) per common share

$

(0.12

)

 

$

(0.02

)

 

$

0.08

 

 

$

(0.05

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common shares

 

34,056,316

 

 

 

22,429,777

 

 

 

33,449,594

 

 

 

22,403,678

 

Unissued, directors' deferred compensation shares

 

236,139

 

 

 

178,597

 

 

 

234,091

 

 

 

177,923

 

 

 

34,292,455

 

 

 

22,608,374

 

 

 

33,683,685

 

 

 

22,581,601

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends per share of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

common stock paid in period

$

0.015

 

 

$

0.01

 

 

$

0.025

 

 

$

0.02

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per share of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

common stock and to be paid in quarter ended June 30

$

-

 

 

$

0.01

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheets

 

 

March 31, 2022

 

 

Sept. 30, 2021

 

Assets

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

$

1,703,675

 

 

$

2,438,511

 

Natural gas, oil, and NGL sales receivables (net of $0

 

9,451,366

 

 

 

6,428,982

 

allowance for uncollectable accounts)

 

 

 

 

 

 

 

Refundable income taxes

 

-

 

 

 

2,413,942

 

Other

 

1,188,312

 

 

 

942,082

 

Total current assets

 

12,343,353

 

 

 

12,223,517

 

 

 

 

 

 

 

 

 

Properties and equipment at cost, based on

 

 

 

 

 

 

 

   successful efforts accounting:

 

 

 

 

 

 

 

Producing natural gas and oil properties

 

264,135,242

 

 

 

319,984,874

 

Non-producing natural gas and oil properties

 

48,878,130

 

 

 

40,466,098

 

Other

 

844,582

 

 

 

794,179

 

 

 

313,857,954

 

 

 

361,245,151

 

Less accumulated depreciation, depletion and amortization

 

(196,960,903

)

 

 

(257,643,661

)

Net properties and equipment

 

116,897,051

 

 

 

103,601,490

 

 

 

 

 

 

 

 

 

Operating lease right-of-use assets

 

564,034

 

 

 

607,414

 

Other, net

 

537,199

 

 

 

578,593

 

Total assets

$

130,341,637

 

 

$

117,011,014

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

$

602,415

 

 

$

772,717

 

Derivative contracts, net

 

14,793,396

 

 

 

12,087,988