Saratoga is an independent exploration and production Company with offices in Houston, Texas and Covington, Louisiana. Principal holdings cover 32,185 gross/net acres, mostly held-by-production, currently located in the transitional coastline and protected in-bay environment on parish and state leases of south Louisiana. For more information, go to our website at and sign up for regular updates by clicking on the Updates button.
Forward-Looking Statements
This press release includes certain estimates and other forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, including statements regarding future ability to fund the company′s development program and grow reserves, production, revenues and profitability, ability to reach and sustain target production levels, ability to secure commitments to participate in exploration of deep shelf prospects, and the ultimate outcome of such efforts. Words such as 'expects?, 'anticipates', 'intends', 'plans', 'believes', 'assumes', 'seeks', 'estimates', 'should', and variations of these words and similar expressions, are intended to identify these forward-looking statements. While we believe these statements are accurate, forward-looking statements are inherently uncertain and we cannot assure you that these expectations will occur and our actual results may be significantly different. These statements by the Company and its management are based on estimates, projections, beliefs and assumptions of management and are not guarantees of future performance. Important factors that could cause actual results to differ from those in the forward-looking statements include the factors described in the 'Risk Factors' section of the Company's filings with the Securities and Exchange Commission. The Company disclaims any obligation to update or revise any forward-looking statement based on the occurrence of future events, the receipt of new information, or otherwise.
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SARATOGA RESOURCES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months Ended March 31,
2012
?
?
2011
Revenues:
Oil and gas revenues
$
19,343,680
$
15,798,288
Other revenues
?
874,248
?
1,148,750
?
Total revenues
20,217,928
16,947,038
?
Operating (Income) Expense:
Lease operating expense
4,570,699
3,959,089
Workover expense
1,471,468
557,731
Exploration expense
57,396
381,432
Loss on plugging and abandonment
1,612,290
-
Dry hole costs
89,874
-
Depreciation, depletion and amortization
4,937,152
3,174,770
Accretion expense
555,504
424,422
General and administrative
2,746,483
1,962,984
Severance taxes
?
1,680,879
?
1,432,541
?
Total operating expenses
?
17,721,745
?
11,892,969
?
Operating income
2,496,183
5,054,069
?
Other income (expense):
Interest income
3,316
27,566
Interest expense
?
(4,411,111)
?
(4,580,886)
?
Total other expense
?
(4,407,795)
?
(4,553,320)
?
Net income (loss) before reorganization expenses and income taxes
(1,911,612)
500,749
?
Reorganization expenses
?
43,205
?
110,012
?
Net income (loss) before income taxes
(1,954,817)
390,737
?
Income tax provision (benefit)
?
(735,743)
?
32,500
?
Net income (loss)
$
(1,219,074)
$
358,237
?
Net income (loss) per share:
Basic
$
(0.04)
$
0.02
Diluted
$
(0.04)
$
0.02
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Weighted average number of common shares outstanding:
Basic
?
27,114,972
?
17,322,487
Diluted
?
27,114,972
?
20,585,431
?
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SARATOGA RESOURCES, INC.
CONSOLIDATED BALANCE SHEETS
?
March 31 2012
?
December 31, 2011
ASSETS
Current assets:
Cash and cash equivalents
$
14,753,985
$
15,874,680
Accounts receivable
11,389,935
10,539,757
Prepaid expenses and other
866,499
1,189,406
Deferred tax asset, net
-
1,400,000
Other current assets
?
150,000
?
150,000
Total current assets
27,160,419
29,153,843
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Property and equipment:
Oil and gas properties - proved (successful efforts method)
202,962,769
196,101,827
Other
?
668,559
?
658,113
203,631,328
196,759,940
Less: Accumulated depreciation, depletion and amortization
?
(58,767,972)
?
(53,830,820)
Total property and equipment, net
144,863,356
142,929,120
?
Deferred tax asset, net
7,316,205
5,147,962
Other assets, net
?
20,511,117
?
20,531,218
Total assets
$
199,851,097
$
197,762,143
?
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable
$
6,607,572
$
4,598,534
Revenue and severance tax payable
5,716,891
5,709,773
Accrued liabilities
7,314,001
8,451,655
Short-term notes payable
-
344,256
Asset retirement obligation ? current
?
908,640
?
1,548,945
Total current liabilities
20,547,104
20,653,163
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Long-term liabilities
Asset retirement obligation
10,343,267
9,852,920
Long-term debt, net of discount of $2,030,188 and $2,115,195, respectively
?
125,469,812
?
125,384,805
Total long-term liabilities
135,813,079
135,237,725
?
Commitment and contingencies (see notes)
?
Stockholders' equity (deficit):
Common stock, $0.001 par value; 100,000,000 shares authorized 27,265,090 and 26,714,815
shares issued and outstanding at March 31, 2012 and December 31, 2011, respectively
27,264
26,714
Additional paid-in capital
55,512,435
52,674,252
Retained earnings
?
(12,048,785)
?
(10,829,711)
?
Total stockholders' equity (deficit)
?
43,490,914
?
41,871,255
?
Total liabilities and stockholders' equity (deficit)
$
199,851,097
$
197,762,143
?
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SARATOGA RESOURCES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Quarter Ended March 31,
2012
?
2011
Cash flows from operating activities:
Net income (loss)
$
(1,219,074)
$
358,237
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation, depletion and amortization
4,937,152
3,174,770
Accretion expense
555,504
424,422
Amortization of debt issuance costs
216,469
63,192
Amortization of debt discount
85,007
708,100
Dry hole costs
89,874
-
Stock-based compensation
261,783
290,684
Loss on plugging and abandonment
1,612,290
-
Deferred tax benefit
(768,243)
-
Changes in operating assets and liabilities:
Accounts receivable
(850,178)
(1,222,118)
Prepaids and other
322,907
433,966
Accounts payable
(556,757)
(1,533,215)
Revenue and severance tax payable
7,118
113,005
Payments to settle asset retirement obligations
(705,462)
(655,241)
Accrued liabilities
?
(3,105,187)
?
376,581
Net cash provided by operating activities
883,203
2,532,383
?
Cash flows from investing activities:
Additions to oil and gas property
(4,029,778)
(359,334)
Additions to other property and equipment
(10,446)
(26,746)
Other assets
?
(196,368)
?
(201,554)
Net cash used by investing activities
(4,236,592)
(587,634)
?
Cash flows from financing activities:
Issuance of warrants
Proceeds from issuance of common stock
2,576,950
9,000
Proceeds from short-term notes payable
-
99,914
Repayment of short-term notes payable
(344,256)
(307,502)
Net cash provided (used) by financing activities
?
2,232,694
?
(198,588)
?
Net increase (decrease) in cash and cash equivalents
(1,120,695)
1,746,161
Cash and cash equivalents - beginning of period
?
15,874,680
?
4,409,984
Cash and cash equivalents - end of period
$
14,753,985
$
6,156,145
?
Supplemental disclosures of cash flow information:
Cash paid for income taxes
$
-
$
-
Cash paid for interest
7,485,332
3,915,130
?
Non-cash investing and financing activities:
Accounts payable for oil and gas additions
$
2,565,795
$
-
Accrued liabilities for oil and gas additions
355,243
-
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Non-GAAP Financial Measures
Discretionary Cash Flow is a non-GAAP financial measure.
Discretionary Cash Flow is a supplemental financial measure used by the company′s management and by securities analysts, investors, lenders, rating agencies and others who follow the industry as an indicator of the company′s ability to internally fund exploration and development activities. Discretionary cash flow should not be considered as a substitute for net income, operating income, cash flows from operating activities or any other measure of financial performance or liquidity presented in accordance with generally accepted accounting principles ('GAAP?). Discretionary cash flow excludes some, but not all, items that affect net income and operating income and these measures may vary among other companies. Therefore, the company′s Discretionary Cash Flow may not be comparable to similarly titled measures used by other companies.
The table below reconciles the most directly comparable GAAP financial measure to Discretionary Cash Flow.
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Reconciliation of Net Income (Loss) to Discretionary Cash Flow
?
?
?
For the Quarter Ended March 31,
2012
?
2011
?
Net income (loss) as reported
$
(1,219,074)
$
358,237
?
Exploration expense
57,396
381,432
Loss on plugging and abandonment
1,612,290
-
Dry hole costs
89,874
-
Depreciation, depletion and amortization
4,937,152
3,174,770
Accretion expense
555,504
424,422
Stock-based compensation
261,783
290,684
Debt issuance and discount
301,476
771,292
Income tax provision (benefit)
?
(768,243)
?
-
?
Discretionary Cash Flow
$
5,828,158
$
5,400,837
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EBITDAX is a non-GAAP financial measure.
EBITDAX is a supplemental financial measure used by the company′s management and by securities analysts, investors, lenders, rating agencies and others who follow the industry as an indicator of the company′s ability to internally fund exploration and development activities and to service or incur additional debt. The company also uses this measure because EBITDAX allows the company to compare its operating performance and return on capital with those of other companies without regard to financing methods and capital structure. EBITDAX should not be considered as a substitute for net income, operating income, cash flows from operating activities or any other measure of financial performance or liquidity presented in accordance with generally accepted accounting principles ('GAAP?). EBITDAX excludes some, but not all, items that affect net income and operating income and these measures may vary among other companies. Therefore, the company′s EBITDAX may not be comparable to similarly titled measures used by other companies.
The table below reconciles the most directly comparable GAAP financial measure to EBITDAX.
