Company Advances Wide-Ranging Program Designed to Increase Production
BAKERSFIELD, CA, Aug. 16, 2010 (Marketwire) --
BAKERSFIELD, CA -- (Marketwire) -- 08/16/10 -- Pyramid Oil Company (NYSE Amex: PDO) announced financial results for its second quarter and six-month period ended June 30, 2010.
Second quarter revenue increased 53% to $1.2 million from $802,000 in the second quarter a year ago. The increase resulted both from higher average crude oil prices and increased production. Average crude prices increased $18.94 per barrel of oil equivalent (BOE) to $74.03 from $55.09 per average BOE in the second quarter a year ago. The increased crude production, which was up by approximately 2,000 barrels versus the second quarter last year, resulted from a new well on the Company's Anderson property, and from higher production volumes on Pyramid's Mountain View property.
Pyramid recorded a non-cash valuation allowance of $842,000 associated with a previously announced unsuccessful well drilled during the first half of 2010 on its Mountain View property. As a result, the Company reported a second quarter operating loss of $583,000 compared with an operating loss of $208,000 in the same quarter a year ago. Second quarter net loss was $302,000, or $0.06 per diluted share, versus a net loss of $39,000, or $0.01 per diluted share, in the second quarter last year.
Pyramid generated operating cash flow of $706,000 during the first six months of fiscal 2010, which compares to cash used in operations of $69,000 during the same period last year. At June 30, 2010, the Company's balance sheet was free of long-term debt and included $4.0 million in cash, cash equivalents and short-term investments; total current assets of $4.9 million, and working capital of $4.5 million. Subsequent to the close of the quarter, Pyramid sold a portion of its working interest in a Texas natural gas joint venture, which provided the Company with an additional $306,000 in cash.
"Our top-line performance is benefitting from the improved price environment for crude, as well as our ongoing efforts to ramp up our sales volumes," said John Alexander, president and CEO. "The well we drilled earlier in the year on our Anderson property represented the first step in an aggressive and wide-ranging program focused on increasing production. Early in the current quarter, we acquired a 30% interest in a shallow oil and gas prospect located in Menard County, Texas, and anticipate the first well in the project will be drilled later this year. We also plan to commence re-drilling operations on up to two wells on our Mountain View properties, and are awaiting a contract-drilling rig scheduled for arrival in late September.
"We have been in active discussions with a private California oil company regarding the establishment of a joint venture that would combine select interests of both companies and involve a multi-well drilling program that could commence later this year. While we have not yet entered into any formal joint venture agreement, we are encouraged by the tone of the discussions and the potential of what could be a long-term collaborative drilling project.
"While increased demand for contract rigs has pushed out the start dates on certain projects, we nevertheless expect to make meaningful progress on our drilling program and long-term growth strategy during the balance of the fiscal year."
For the six-month period, Pyramid reported revenue of $2.2 million, up 60% versus $1.4 million at the six-month mark last year. Operating loss was $354,000 versus an operating loss of $427,000 in the six-month period a year ago. Net loss was $121,000, or $0.03 per diluted share, versus a net loss of $228,000, or $0.05 per diluted share, in the same period last year.
About Pyramid Oil Company
Pyramid Oil Company has been in the oil and gas business continuously since incorporating in 1909. Pyramid acquires interests in land and producing properties through acquisition and lease, and then drills and/or operates crude or natural gas wells in an effort to discover or produce oil and/or natural gas. More information about the Company can be found at: http://www.pyramidoil.com.
Safe Harbor Statement
Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995, including statements regarding the completion and testing of wells. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially from forecasted results. Factors that could cause or contribute to such differences include, but are not limited to the value of crude oil or the performance of wells.
PYRAMID OIL COMPANY
STATEMENTS OF OPERATIONS
(UNAUDITED)
Three months ended June 30, Six months ended June 30,
--------------------------- ---------------------------
2010 2009 2010 2009
------------- ------------- ------------- -------------
REVENUES: $ 1,228,391 $ 801,901 $ 2,230,130 $ 1,395,946
------------- ------------- ------------- -------------
COSTS AND EXPENSES:
Operating expenses 438,392 325,189 778,312 676,539
General and
administrative 250,588 229,797 457,955 455,102
Severance award
agreement 0 209,935 0 209,935
Taxes, other than
incomeand payroll
taxes 29,839 32,486 57,659 80,784
Provision for
depletion,
depreciation and
amortization 196,873 160,142 346,260 318,456
Valuation
allowances 842,327 0 867,468 0
Accretion expense 5,898 5,932 12,111 11,798
Other costs and
expenses 47,303 45,975 64,543 70,145
------------- ------------- ------------- -------------
1,811,220 1,009,456 2,584,308 1,822,759
------------- ------------- ------------- -------------
OPERATING INCOME
(LOSS) -582,829 -207,555 -354,178 -426,813
------------- ------------- ------------- -------------
OTHER INCOME
(EXPENSE):
Interest income 8,430 21,395 16,383 47,870
Other income 3,600 3,600 6,397 7,200
Interest expense -122 -358 -303 -773
------------- ------------- ------------- -------------
11,908 24,637 22,477 54,297
------------- ------------- ------------- -------------
INCOME (LOSS) BEFORE
INCOME TAX PROVISION
(BENEFIT) -570,921 -182,918 -331,701 -372,516
Income tax
provision
(benefit)
Current 24,900 -34,200 44,900 -137,583
Deferred -293,950 -109,800 -255,400 -6,800
------------- ------------- ------------- -------------
-269,050 -144,000 -210,500 -144,383
------------- ------------- ------------- -------------
NET INCOME (LOSS) $ -301,871 $ -38,918 $ -121,201 $ -228,133
============= ============= ============= =============
BASIC INCOME (LOSS)
PER COMMON SHARE $ -0.06 $ -0.01 $ -0.03 $ -0.05
============= ============= ============= =============
DILUTED INCOME (LOSS)
PER COMMON SHARE $ -0.06 $ -0.01 $ -0.03 $ -0.05
============= ============= ============= =============
Basic and diluted
weighted average
number of common
shares outstanding 4,677,728 4,677,728 4,677,728 4,677,728
============= ============= ============= =============
PYRAMID OIL COMPANY
BALANCE SHEETS
ASSETS
June 30, December 31,
2010 2009
(Unaudited) (Audited)
------------- -------------
CURRENT ASSETS:
Cash and cash equivalents $ 903,380 $ 1,438,825
Short-term investments 3,075,960 3,344,061
Trade accounts receivable 529,553 375,954
Income taxes receivable 51,100 124,281
Crude oil inventory 64,833 62,760
Deferred income taxes 196,200 196,200
Prepaid expenses and other assets 97,448 169,595
------------- -------------
TOTAL CURRENT ASSETS 4,918,474 5,711,676
------------- -------------
PROPERTY AND EQUIPMENT, at cost
Oil and gas properties and equipment
(successful efforts method) 17,572,902 16,085,228
Capitalized asset retirement costs 389,463 382,550
Drilling and operating equipment 2,109,993 2,109,993
Land, buildings and improvements 1,066,571 1,065,371
Automotive, office and other property and
equipment 1,164,636 1,160,617
------------- -------------
22,303,565 20,803,759
Less: accumulated depletion, depreciation,
amortization and valuation allowance -18,335,247 -17,125,834
------------- -------------
TOTAL PROPERTY AND EQUIPMENT 3,968,318 3,677,925
------------- -------------
OTHER ASSETS
Deposits 250,000 250,000
Deferred income taxes 740,800 485,400
Other Assets 17,013 17,013
TOTAL OTHER ASSETS 1,007,813 752,413
------------- -------------
TOTAL ASSETS $ 9,894,605 $ 10,142,014
============= =============
PYRAMID OIL COMPANY
BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
June 30, December 31,
2010 2009
(Unaudited) (Audited)
------------- -------------
CURRENT LIABILITIES:
Accounts payable $ 50,905 $ 88,170
Accrued professional fees 103,890 138,381
Accrued taxes, other than income taxes 4,194 62,310
Accrued payroll and related costs 55,324 51,606
Accrued royalties payable 190,095 159,933
Accrued insurance 18,010 54,947
Current maturities of long-term debt 8,336 20,640
------------- -------------
TOTAL CURRENT LIABILITIES 430,754 575,987
------------- -------------
LIABILITY FOR ASSET RETIREMENT OBLIGATION 1,212,349 1,193,324
------------- -------------
TOTAL LIABILITIES 1,643,103 1,769,311
------------- -------------
COMMITMENTS
STOCKHOLDERS' EQUITY:
Preferred stock - no par value; 10,000,000
authorized shares; no shares issued or
outstanding 0 0
Common stock - no par value; 50,000,000
authorized shares; 4,677,728 shares issued and
outstanding 1,515,945 1,515,945
Retained earnings 6,735,557 6,856,758
------------- -------------
TOTAL STOCKHOLDERS' EQUITY 8,251,502 8,372,703
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 9,894,605 $ 10,142,014
============= =============
CONTACTS:
John H. Alexander
President and CEO
Pyramid Oil Company
661-325-1000
Geoff High
Principal
Pfeiffer High Investor Relations, Inc.
303-393-7044
