New Concept Energy, Inc. Reports Third Quarter 2016 Results

New Concept Energy, Inc. (NYSE MKT: GBR), (the "Company" or "NCE"), a Dallas-based oil and gas company, today reported net loss for the three months ended September 30, 2016 of $164,000 or $0.08 per share, compared to a net loss of $75,000 or $0.04 per share for the three months ended September 30, 2015. Included in 2015 was income for a recovery of bad debt expense of $306,000.

For the three months ended September 30, 2016, the Company recorded oil and gas revenues, net of royalty expenses of $190,000 as compared to $232,000 for the comparable period of 2015. The decline in oil and gas revenue was principally due to the price the Company was receiving for its oil sales in 2016 as compared to 2015.

The Company recorded revenues of $653,000 for the three months ended September 30, 2016 from its retirement property compared to $772,000 for the comparable period in 2015. The decrease was primarily due to a drop in occupancy at the facility caused principally by the opening of a competing facility in the community where our facility is located.

For the three months ended September 30, 2016, the Company recorded oil and gas operating expenses of $295,000 as compared to $527,000 for the comparable period of 2015. The decrease was due to a decrease in overall operating expenses as the Company has actively been reducing costs to compensate for the reduction in revenue.

For the three months ended September 30, 2016, operating expenses at the retirement property were $396,000 as compared to $423,000 for the comparable period in 2015. The decrease in operating expenses were due to an overall decrease in non-payroll related expenses.

For the three months ended September 30, 2016, corporate general & administrative expenses were $52,000 as compared to $176,000 for the comparable periods in 2015. The decrease is primarily due to a reduction in wages and overall operating expenses.
       
 
NEW CONCEPT ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
(amounts in thousands)
 

September 30, 2016

December 31, 2015
 
Assets
 
Current assets
Cash and cash equivalents $ 530 $ 473
Accounts receivable from oil and gas sales 105 141
Other current assets   47   37
Total current assets   682   651
 
 
Oil and natural gas properties (full cost accounting method)
Proved developed and undeveloped oil and gas properties, net of depletion 5,658 5,914
 
Property and equipment, net of depreciation
Land, buildings and equipment - oil and gas operations 722 803
Other   142   134
Total property and equipment 864 937
 
Other assets   1,344   1,373
 
Total assets $ 8,548 $ 8,875
       
 
NEW CONCEPT ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - CONTINUED
(unaudited)
(amounts in thousands, except share amounts)
 

September 30, 2016

December 31, 2015
 
Liabilities and stockholders' equity
 
Current liabilities
Accounts payable - trade (including $580,000 and $165,000 in 2016 and 2015 due to related parties) $ 605 $ 241
Accrued expenses 148 151
Current portion of long term debt   828     831  
Total current liabilities 1,581 1,223
 
Long-term debt
Notes payable less current portion 1,119 1,211
Asset retirement obligation   2,770     2,770  
Total liabilities 5,470 5,204
 
Stockholders' equity
Preferred stock, Series B 1 1
Common stock, $.01 par value; authorized, 100,000,000
shares; issued and outstanding, 1,946,934 shares
at September 30, 2016 and December 31, 2015 20 20
Additional paid-in capital 58,838 58,838
Accumulated deficit   (55,781 )   (55,188 )
  3,078     3,671  
 
Total liabilities & equity $ 8,548   $ 8,875  
               
 
NEW CONCEPT ENERGY, INC AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
(amounts in thousands, except per share data)
 

For the Three Months ended September 30,

For the Nine Months ended September 30,
2016 2015 2016 2015
Revenue
Oil and gas operations, net of royalties $ 190 $ 232 $ 579 $ 663
Real estate operations   653     772     1,995     2,233  
  843     1,004     2,574     2,896  
 
 
Operating expenses
Oil and gas operations 295 527 924 1,437
Real estate operations 396 423 1,146 1,248
Lease expense 251 245 748 735
Corporate general and administrative   52     176     319     485  
  994     1,371     3,137     3,905  
Operating earnings (loss) (151 ) (367 ) (563 ) (1,009 )
 
 
Other income (expense)
Interest income 6 6 17 6
Interest expense (8 ) (12 ) (26 ) (54 )
Recovery of bad debt expense - 306 0 1,430
Other income (expense), net   (11 )   (8 )   (21 )   (24 )
Other income (expense)   (13 )   292     (30 )   1,358  
 
 
Net income (loss) applicable to common shares $ (164 ) $ (75 ) $ (593 ) $ 349  
 
Net income (loss) per common share-basic and diluted $ (0.08 ) $ (0.04 ) $ (0.30 ) $ 0.18  
 
 
Weighted average common and equivalent shares outstanding - basic 1,947 1,947 1,947 1,947

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