Recovery Energy Announces 2010 Financial Results, Provides Operations Update
Net loss for the year ended 2010 was $16,785,583, or $0.46 per share, compared with a net loss of $29,911,381, or $3.05 per share, for the period March 6, 2009 (inception) through December 31, 2009. Net cash provided by operating activities increased to $3,758,694 in 2010 from ($381,239) in 2009.
Total non-cash general and administrative expenditures for the three and twelve months ended December 31, 2010 was approximately $3,024,212 and $10,400,000, respectively. This compares to approximately $1,057,306 in general and administrative expenditures from inception through December 31, 2009 which included non-cash expenditures of $690,000.
As of December 31, 2010, the Company had working capital of $5,586,906, including $6,679,285 of cash and cash equivalents of which $1,150,541 is restricted cash.
For additional information, please refer to the Recovery Energy, Inc. Annual Report on Form 10-K for the year ended December 31, 2010, filed with the Securities and Exchange Commission.About Recovery Energy, Inc. Recovery Energy, Inc. (OTCBB: RECV) is a Denver-based independent oil and gas exploration and production company focused on the Denver-Julesburg (DJ) Basin where it holds 134,000 net acres and management has more than 70 years’ experience. Recovery Energy’s primary focus is on growing revenue, cash-flow and reserves through its conventional drilling program on low-risk, low-cost, in-field targets, as well as through an unconventional drilling program targeting the various prospective oil shale horizons on its land. In addition to being prospective for the Niobrara oil shale formation, the Company’s asset base is comprised of current production and reserves from the “J” sand along with extensive leasehold prospective for other hydrocarbon-bearing formations such as the Pierre Shale, Codell, Greenhorn and Paleozoic horizons. This press release may include “forward-looking statements” as defined by the Securities and Exchange Commission (the "SEC"), including statements, without limitation, regarding the Company’s expectations, beliefs, intentions or strategies regarding the future. Such forward-looking statements relate to, among other things the Company's: (1) proposed exploration and drilling operations, (2) expected production and revenue, and (3) estimates regarding the reserve potential of its properties. These statements are qualified by important factors that could cause the Company’s actual results to differ materially from those reflected by the forward-looking statements. Such factors include but are not limited to: (1) the Company’s ability to finance its the continued exploration and drilling operations, (2) positive confirmation of the reserves, production and operating expenses associated with the Company's properties; and (3) the general risks associated with oil and gas exploration and development, including those risks and factors described from time to time in the Company’s reports and registration statements filed with the SEC.
CONSOLIDATED BALANCE SHEETS
|Total current assets||7,564,611||284,525|
|Oil and gas properties (full cost method), at cost:|
|Wells in progress||1,219,397||-|
|Total Property and equipment||61,132,966||-|
|Less accumulated depreciation, depletion and amortization||(5,008,606||)||-|
|Net properties and equipment||56,124,360||-|
|Office equipment, net||56,236||470|
|Prepaid advisory fees||979,449||-|
|Deferred financing costs||3,211,566||-|
|Restricted cash and deposits||185,707||110,031|
|Assets held for sale||-||500,000|
|Total other assets||4,432,958||610,501|
|Liabilities and Shareholders' Equity|
|Liabilities from price risk management||398,840||-|
|Related Party Payable||11,638||70,876|
|Common Stock Issuable||-||100,000|
|Short term note||208,881||-|
|Total current liabilities||3,128,246||328,754|
|Asset retirement obligation||507,280||-|
|Total long term liabilities||20,737,081||-|
Common Stock Subject to Redemption Rights, $0.0001 par value; 42,500 and 85,000 shares issued and outstanding as of December 31, 2010 and 2009
|Other Shareholders’ Equity:|
|Preferred Stock, $0.0001 par value: 10,000,000 authorized; no shares issued or outstanding||-||-|
|Common Stock, $0.0001 par value: 100,000,000 shares authorized; 57,814,369 shares and 10,774,000 shares issued and outstanding (excluding shares subject to redemption) as of December 31, 2010 and 2009||5,781||1,077|
|Additional Paid in Capital||90,861,527||30,304,060|
|Total other shareholders' equity||44,170,344||393,756|
|Total Liabilities, Common Stock Subject to Redemption Rights and Other Shareholders’ Equity||$||68,121,929||$||895,026|
CONSOLIDATED STATEMENTS OF OPERATIONS
March 6, 2009 (Inception) through
December 31, 2010
December 31, 2009
|Realized gain (loss) on hedges||570,233||-|
|Price risk management activities||(398,840||)||-|
|Costs and expenses:|
|General and administrative (includes non-cash consideration of $10,143,896 and $684,778 for the periods ended December 31, 2010 and 2009)||12,576,798||1,057,306|
|Depreciation, depletion and amortization||5,036,648||-|
|Impairment of equipment||-||2,750,000|
|Bad debt expense||400,000||-|
|Fair value of common stock and warrants issued in aborted property acquisitions||-||8,404,106|
|Reorganization and merger costs||-||17,700,000|
|Total costs and expenses||19,931,732||29,911,412|
|Loss from operations||(10,174,040||)||(29,911,412||)|
|Unrealized gain on Lock-up||$||28,666||$||-|
|Interest expense (includes non-cash interest expense of $3,989,649 and $0 for the periods ended December 31, 2010 and 2009)||$||(6,640,209||)||$||31|
|Earnings per common share|
|Basic and Diluted||$||(0.46||)||$||(3.05||)|
|Weighted average shares outstanding:|
|Basic and diluted||36,671,213||9,815,683|
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