New Concept Energy, Inc. (NYSE MKT: GBR) (the “Company” or “NCE”), a Dallas-based oil and gas company, today reported Results of Operations for the fourth quarter ended December 31, 2013. During the three months ended December 31, 2013 the Company reported net income of $124,000 or $0.06 per share, compared to net income of $84,000 or $0.04 per share for the same period ended December 31, 2012.
For the year ended December 31, 2013 the Company had net income of $426,000 or $0.22 per share, compared to net income of $168,000 or $0.09 per share for the year ended December 31, 2012.
Total revenue for 2013 was $1.5 million for our oil & gas segment and $2.7 million for our real estate segment as compared to $1.2 million for oil & gas and $2.7 million for real estate in 2012. Net revenue for our oil and gas operation increased by $300,000 principally due to both the quantity of both oil and gas produced as well as the price in 2013 as compared to 2012.
Operating expenses for the oil and gas operations were $2.1 million and $2.8 million for the years of 2013 and 2012 respectively. Included in operating expenses were non-cash expenses for depreciation, depletion and amortization of $654,000 in 2013 and $690,000 in 2012.
In 2013 the Company recorded a $200,000 non-cash charge to operations to write down its investment in two wells in Arkansas. In 2012 the Company recorded a similar non-cash charge to operations of $912,000 for its operations in West Virginia / Ohio. In 2013 the value of our investment in West Virginia / Ohio calculated in accordance with the “full cost ceiling test” was recovered; however, the accounting rules prohibit the recovery of a previously taken write-down.
Operating expense for the real estate segment were $2.5 million in 2013 and $2.4 million in 2012.
In the fourth quarter of 2011 the Company had a $10.3 million note receivable and determined that the financial condition of the debtor had deteriorated and there could be no assurance that the amount owed would or could be collected. At that time the company recorded a loss and established a reserve of $10.3 million. In 2013 and 2012 the Company recorded a gain from the partial recovery of the previously reserved note receivable of $1.6 million and $2.1 million respectively. The Company will continue to attempt to collect the balance of the receivable.
| NEW CONCEPT ENERGY, INC. AND SUBSIDIARIES | |||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATION | |||||||||||||||
| (amounts in thousands, except per share data) | |||||||||||||||
| Year Ended December 31, | |||||||||||||||
| 2013 | 2012 | 2011 | |||||||||||||
| Revenue | |||||||||||||||
| Oil and gas operations, net of royalties | $ | 1,477 | $ | 1,182 | $ | 1,020 | |||||||||
| Real estate operations | 2,745 | 2,762 | 2,881 | ||||||||||||
| 4,222 | 3,944 | 3,901 | |||||||||||||
| Operating expenses | |||||||||||||||
| Oil and gas operations | 1,867 | 1,820 | 1,430 | ||||||||||||
| Real estate operations | 1,555 | 1,465 | 1,290 | ||||||||||||
| Lease expense | 942 | 924 | 906 | ||||||||||||
| Corporate general and administrative | 500 | 577 | 579 | ||||||||||||
| Accretion of asset retirement obligation | - | 68 | 129 | ||||||||||||
Impairment of natural gas and oil properties | 200 | 912 | 1,428 | ||||||||||||
| 5,064 | 5,766 | 5,762 | |||||||||||||
| Operating earnings (loss) | (842 | ) | (1,822 | ) | (1,861 | ) | |||||||||
| Other income (expense) | |||||||||||||||
| Interest income | 9 | - | 360 | ||||||||||||
| Interest expense | (114 | ) | (208 | ) | (131 | ) | |||||||||
| Bad debt expense (recovery) - note receivable | 1,562 | 2,076 | (10,006 | ) | |||||||||||
| Other income (expense), net | (189 | ) | 122 | (155 | ) | ||||||||||
| 1,268 | 1,990 | (9,932 | ) | ||||||||||||
| Earnings from continuing operations | 426 | 168 | (11,793 | ) | |||||||||||
| Net income (loss) applicable to common shares | $ | 426 | $ | 168 | $ | (11,793 | ) | ||||||||
| Net income (loss) per common share-basic and diluted | $ | 0.22 | $ | 0.09 | $ | (6.06 | ) | ||||||||
| Weighted average common and equivalent shares outstanding - basic | 1,947 | 1,947 | 1,947 | ||||||||||||
| NEW CONCEPT ENERGY, INC. AND SUBSIDIARIES | ||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||
| (amounts in thousands) | ||||||||
| December 31 | ||||||||
| 2013 | 2012 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 1,621 | $ | 398 | ||||
| Accounts receivable from oil and gas sales | 195 | 210 | ||||||
| Other current assets | 203 | 2 | ||||||
| Total current assets | 2,019 | 610 | ||||||
| Oil and natural gas properties (full cost accounting method) | ||||||||
| Proved developed and undeveloped oil and gas properties, net of depletion | 9,190 | 9,717 | ||||||
| Property and equipment, net of depreciation | ||||||||
| Land, buildings and equipment - oil and gas operations | 1,442 | 1,410 | ||||||
| Other | 183 | 204 | ||||||
| Total property and equipment | 1,625 | 1,614 | ||||||
| Other assets (including $122,000 and $161,000 in 2013 and 2012 due from related parties) | 474 | 543 | ||||||
| Total assets | $ | 13,308 | $ | 12,484 | ||||
| NEW CONCEPT ENERGY, INC. AND SUBSIDIARIES | ||||||||||
| CONSOLIDATED BALANCE SHEETS - CONTINUED | ||||||||||
| (amounts in thousands, except share amounts) | ||||||||||
| December 31 | ||||||||||
| 2013 | 2012 | |||||||||
| Liabilities and stockholders' equity | ||||||||||
| Current liabilities | ||||||||||
| Accounts payable - trade | $ | 121 | $ | 38 | ||||||
| Accrued expenses | 965 | 173 | ||||||||
| Current portion of long term debt | 185 | 93 | ||||||||
| Total current liabilities | 1,271 | 304 | ||||||||
| Long-term debt | ||||||||||
| Notes payable less current portion | 2,195 | 2,273 | ||||||||
| Payable - related parties | - | - | ||||||||
| Asset retirement obligation | 2,770 | 2,770 | ||||||||
| Other long-term liabilities | - | 491 | ||||||||
| Total liabilities | 6,236 | 5,838 | ||||||||
| Stockholders' equity | ||||||||||
| Series B convertible preferred stock, $10 par value, liquidation value | ||||||||||
| of $100 authorized 100 shares, issued and outstanding one share | 1 | 1 | ||||||||
| Common stock, $.01 par value; authorized, 100,000,000 | ||||||||||
| shares; issued and outstanding, 1,946,935 shares | ||||||||||
at December 31, 2013 and 2012 | 20 | 20 | ||||||||
| Additional paid-in capital | 58,838 | 58,838 | ||||||||
| Accumulated deficit | (51,787 | ) | (52,213 | ) | ||||||
| 7,072 | 6,646 | |||||||||
| Total liabilities & equity | $ | 13,308 | $ | 12,484 | ||||||
Contacts:
Gene Bertcher, 800-400-6407
info@newconceptenergy.com
