SOURCE: Pyramid Oil Company

Pyramid Oil Company

August 14, 2014 08:00 ET

Pyramid Oil Company Reports Second Quarter and Year-to-Date Financial Results

BAKERSFIELD, CA--(Marketwired - Aug 14, 2014) - Pyramid Oil Company (NYSE MKT: PDO) today announced financial results for its second quarter and six-month period ended June 30, 2014.

Second quarter 2014 revenue was $1.0 million versus $1.2 million in the same quarter a year ago. Crude oil production for the second quarter of 2014 declined 16% to 9,809 barrels of oil equivalent (BOE) from 11,685 BOE in the second quarter a year ago. The production decrease was partially offset by an increase of $5.47 in the average realized crude oil price, which was $104.27 during the second quarter of 2014 versus $98.79 in the same period of 2013.

Operating income for the second quarter of 2014 was $115,000 versus $173,000 for the second quarter of 2013. Net income was $73,000, or $0.02 per share, versus $130,000, or $0.03 per share, in the 2013 second quarter.

Through the first six months of 2014, revenue was $2.1 million, versus $2.2 million the same period of 2013. The Company reported an operating loss for the 2014 six-month period of $108,000 versus operating income of $337,000 for the first six months of 2013. The decline was largely due to a $393,000 increase in general and administrative expense for the first six months of 2014 compared to last year's six-month period. During the first six months of 2014, an increase of $581,000 in legal and consulting fees associated with the proposed merger agreement between the Company and Yuma Energy, Inc. was partially offset by a $99,000 reduction in officer and administrative salaries and a $77,000 reduction in accounting fees. Net loss for the first six months of 2014 was $86,000, or $0.02 per share, versus net income of $243,000, or $0.05 per share, in the first six months of 2013.

Pyramid closed the second quarter of 2014 with cash and cash equivalents of $4.4 million. Working capital was $7.3 million and the Company's current ratio was 12:1. Pyramid also reported long-term assets in the form of certificates of deposit of $1.1 million. Current liabilities at June 30, 2014, were $670,000 and total liabilities were $2.0 million. Stockholders' equity at the end of the 2014 second quarter was $10.9 million.

Michael D. Herman, Interim President and CEO, said, "We are making continued progress on our planned merger with Yuma Energy. As was recently announced, both companies have set September 10, 2014, as the date for special meetings of their respective stockholders, who will be asked to vote on the transaction and certain other related matters. Provided both companies receive stockholder approval, we expect to complete the merger in the third quarter of 2014."

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.

Forward-Looking Statements
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended. Statements that are not strictly historical statements constitute forward-looking statements and may often, but not always, be identified by the use of such words such as "expects," "believes," "intends," "anticipates," "plans," "estimates," "potential," "possible," or "probable" or statements that certain actions, events or results "may," "will," "should," or "could" be taken occur or be achieved. The forward-looking statements include statements about the anticipated timing for closing the proposed merger. Forward-looking statements are based on current expectations and assumptions and analyses made by Yuma and Pyramid in light of experience and perception of historical trends, current conditions and expected future developments, as well as other factors appropriate under the circumstances. However, whether actual results and developments will conform with expectations is subject to a number of risks and uncertainties, including but not limited to: the possibility that the companies may be unable to obtain stockholder approval or satisfy the other conditions to closing; that problems may arise in the integration of the businesses of the two companies; that the acquisition may involve unexpected costs; the risks of the oil and gas industry (for example, operational risks in exploring for, developing and producing crude oil and natural gas; risks and uncertainties involving geology of oil and gas deposits); the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to future production, costs and expenses; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; health, safety and environmental risks and risks related to weather; fluctuations in oil and gas prices; inability of management to execute its plans to meet its goals, shortages of drilling equipment, oil field personnel and services, unavailability of gathering systems, pipelines and processing facilities and the possibility that government policies may change. Pyramid's annual report on Form 10-K for the year ended December 31, 2013, quarterly reports on Form 10-Q, recent current reports on Form 8-K, and other Securities and Exchange Commission ("SEC") filings discuss some of the important risk factors identified that may affect its business, results of operations, and financial condition. Pyramid and Yuma undertake no obligation to revise or update publicly any forward-looking statements for any reason.

Additional Information About the Transaction
In connection with the proposed transaction, Pyramid has filed with the SEC a registration statement on Form S-4 that includes a proxy statement of Pyramid that also constitutes a prospectus of Pyramid relating to Pyramid common stock to be issued to Yuma stockholders pursuant to the merger. The definitive proxy statement/prospectus includes important information about both Yuma and Pyramid. Pyramid may also file other relevant documents with the SEC regarding the proposed transaction. INVESTORS AND SECURITY HOLDERS ARE URGED TO CAREFULLY READ THE REGISTRATION STATEMENT, THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC AS THEY BECOME AVAILABLE BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT PYRAMID AND THE PROPOSED TRANSACTION. Investors and security holders may obtain these documents when available free of charge at the SEC's website at www.sec.gov. In addition, the documents filed with the SEC by Pyramid can be obtained free of charge from Pyramid's website at www.pyramidoil.com.

Participants in Solicitation
Pyramid and its executive officers and directors may be deemed to be participants in the solicitation of proxies from the stockholders of Pyramid in respect of the proposed transaction. Information regarding Pyramid's directors and executive officers is available in its annual report on Form 10-K for the year ended December 31, 2013, which was filed with the SEC on March 31, 2014. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, are and will be contained in the proxy statement/prospectus referred to above and other relevant materials filed with the SEC.

This release shall not constitute an offer to sell or the solicitation of any offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act.

PYRAMID OIL COMPANY
STATEMENTS OF OPERATIONS
(UNAUDITED)
                   
    Three months ended June 30,   Six months ended June 30,
                   
    2014     2013   2014   2013
                           
REVENUES:                          
  Oil and gas sales   $ 1,022,757     $ 1,154,409   $ 2,066,356   $ 2,162,212
                           
COSTS AND EXPENSES:                          
  Operating expenses     435,837       500,043     932,127     934,481
  General and administrative     272,328       234,862     850,291     457,003
  Taxes, other than income                          
  and payroll taxes     27,495       37,158     61,104     67,555
  Provision for depletion,                          
  depreciation and amortization     113,541       148,817     217,511     261,796
  Accretion expense     14,073       7,932     23,490     18,311
  Other costs and expenses     43,989       52,973     90,079     86,198
                           
      907,263       981,785     2,174,602     1,825,344
                           
OPERATING INCOME (LOSS)     115,494       172,624     (108,246 )   336,868
                           
OTHER INCOME (EXPENSE):                          
  Interest income     9,736       10,004     19,397     20,315
  Other income     (321 )     0     6,679     0
                           
      9,415       10,004     26,076     20,315
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT)     124,909       182,628     (82,170 )   357,183
  Income tax expense (benefit)                          
    Current     (186,200 )     9,357     (711,200 )   15,126
    Deferred     238,200       43,200     714,700     99,300
      52,000       52,557     3,500     114,426
                           
NET INCOME (LOSS)   $ 72,909     $ 130,071   $ (85,670 ) $ 242,757
                           
BASIC INCOME (LOSS)                          
PER COMMON SHARE   $ 0.02     $ 0.03   $ (0.02 ) $ 0.05
                           
DILUTED INCOME (LOSS)                          
PER COMMON SHARE   $ 0.02     $ 0.03   $ (0.02 ) $ 0.05
                           
Weighted average number of common shares outstanding     4,754,752       4,688,085     4,721,418     4,688,085
                           
Diluted average number of common shares outstanding     4,761,614       4,688,085     4,721,418     4,688,085
                           
                           
                           
PYRAMID OIL COMPANY  
BALANCE SHEETS  
             
ASSETS  
             
             
    June 30,     December 31,  
    2014     2013  
    (Unaudited)     (Audited)  
                 
CURRENT ASSETS:                
  Cash and cash equivalents   $ 4,355,590     $ 4,404,246  
  Restricted cash     0       967,329  
  Short-term investments     2,143,028       2,140,822  
  Trade accounts receivable     486,632       484,468  
  Income taxes receivable     724,400       12,400  
  Crude oil inventory     92,524       102,334  
  Prepaid expenses and other assets     126,839       249,030  
  Deferred income taxes     87,000       711,800  
                 
    TOTAL CURRENT ASSETS     8,016,013       9,072,429  
                 
PROPERTY AND EQUIPMENT, at cost                
  Oil and gas properties and equipment                
  (successful efforts method)     19,899,762       19,883,190  
  Capitalized asset retirement costs     412,612       412,612  
  Drilling and operating equipment     2,058,744       2,058,744  
  Land, buildings and improvements     1,098,918       1,098,918  
  Automotive, office and other                
  property and equipment     1,158,764       1,136,566  
                 
      24,628,800       24,590,030  
  Less: accumulated depletion, depreciation, amortization and valuation allowances     (21,529,273 )     (21,335,914 )
                 
  TOTAL PROPERTY AND EQUIPMENT     3,099,527       3,254,116  
                 
INVESTMENTS AND OTHER ASSETS                
  Long-term investments     1,146,674       1,131,707  
  Deferred income taxes     370,000       459,900  
  Deposits     250,000       250,000  
  Other Assets     11,380       11,380  
                 
  TOTAL INVESTMENTS OTHER ASSETS     1,778,054       1,852,987  
                 
    TOTAL ASSETS   $ 12,893,594     $ 14,179,532  
                 
                 
         
PYRAMID OIL COMPANY
BALANCE SHEETS
         
LIABILITIES AND STOCKHOLDERS' EQUITY
         
         
    June 30,   December 31,
    2014   2013
    (Unaudited)   (Audited)
             
CURRENT LIABILITIES:            
  Accounts payable   $ 304,429   $ 290,930
  Accrued professional fees     12,162     140,711
  Accrued taxes, other than income taxes     0     54,444
  Accrued payroll and related costs     37,572     40,932
  Accrued royalties payable     240,548     226,502
  Liability for deferred compensation     39,166     1,026,655
  Accrued insurance     36,018     113,480
             
    TOTAL CURRENT LIABILITIES     669,895     1,893,654
             
LIABILITY FOR ASSET RETIREMENT OBLIGATIONS     1,329,352     1,305,862
             
  TOTAL LIABILITIES     1,999,247     3,199,516
             
COMMITMENTS AND CONTINGENCIES            
             
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; 4,788,085 shares issued andoutstanding    
1,847,384
   
1,847,384
  Retained earnings     9,046,963     9,132,632
             
    TOTAL STOCKHOLDERS' EQUITY     10,894,347     10,980,016
             
             
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $ 12,893,594   $ 14,179,532
             
             
             
             
             

Contact Information

  • Contact:
    Geoff High
    Principal
    Pfeiffer High Investor Relations, Inc.
    Telephone: (303) 393-7044