Exhibit 99.1
Yuma Energy, Inc.
 
 
 
 
NEWS RELEASE
 
Yuma Energy, Inc. Announces 2017 Financial Results
 
HOUSTON, TX – (PR Newswire – April 2, 2018) – Yuma Energy, Inc. (
NYSE American: YUMA) (the “Company” or “Yuma”) today announced its financial results for the year ended December 31, 2017.
 
Year End 2017 Highlights
 
Yuma spud its first San Andres horizontal well in December 2017 and completed it during the first quarter of 2018. All of the associated facilities have been installed and the well is currently in the early stages of production, recovering frac fluids and dewatering the near wellbore area.
 
Net average production for the year ended December 31, 2017 was 2,454 Boe/d, or 34.8% higher than the net average production for the prior year of 1,820 Boe/d.
 
Yuma reduced its debt by $11.8 million during 2017, bringing its bank debt down to $27.7 million.
 
Yuma closed its common stock offering of 10,100,000 shares of common stock in October 2017 (including 500,000 shares purchased pursuant to the underwriters’ overallotment option) for gross proceeds of $10,100,000 before deducting underwriters’ fees and offering expenses.
 
Management Comments
 
Sam L. Banks, CEO of Yuma Energy, Inc., commented, “We are looking forward to the results of our first San Andres horizontal well, and continuing to expand our position in the play. During 2018, we intend to take advantage of the low-risk and low-cost growth opportunities within our existing inventory, continue the development and expansion of our San Andres play, and actively pursue acquisitions and mergers.”
 
Oil and Natural Gas Reserves – SEC Prices
 
The table below summarizes the Company’s estimated proved reserves at December 31, 2017, which were prepared in accordance with Securities and Exchange Commission (“SEC”) guidelines by Netherland, Sewell & Associates, Inc. (“NSAI”), an independent petroleum engineering firm. In preparing its report, NSAI evaluated 100% of the Company’s properties at December 31, 2017.
 
Proved reserves were calculated using prices equal to the twelve-month unweighted arithmetic average of the first-day-of-the-month prices for each of the preceding twelve months, which were $51.34 per Bbl West Texas Intermediate and $2.976 per MMBtu Henry Hub, for the year ended December 31, 2017. Adjustments were made for location and grade. The information in the following table does not give any effect to or reflect the Company’s commodity derivatives.
 
 
 
Oil (MBbls)
 
 
Natural Gas Liquids (MBbls)
 
 
Natural Gas (MMcf)
 
 
Total (MBoe)(1)
 
 
Present Value Discounted at 10% ($ in thousands) (2)
 
Proved developed
  1,763 
  1,009 
  21,131 
  6,295 
 $64,028 
Proved undeveloped
  599 
  285 
  2,465 
  1,295 
  8,875 
Total proved
  2,362 
  1,294 
  23,596 
  7,590 
 $72,903 
 
(1)            
Barrels of oil equivalent have been calculated on the basis of six thousand cubic feet (Mcf) of natural gas equal to one barrel of oil equivalent (Boe).
 
(2)            
PV10 is a non-GAAP financial measure. See “Reconciliation of GAAP to Non-GAAP Financial Measures.”
 
 
1
 
 
Financial Results
 
Production
 
The following table presents the net quantities of oil, natural gas and natural gas liquids produced and sold by the Company for the years ended December 31, 2017 and 2016, and the average sales price per unit sold.
 
 
 
Years Ended December 31,
 
 
 
2017
 
 
2016
 
Production volumes:
 
 
 
 
 
 
Crude oil and condensate (Bbls)
  250,343 
  172,003 
Natural gas (Mcf)
  3,085,613 
  2,326,400 
Natural gas liquids (Bbls)
  131,155 
  104,689 
Total (Boe) (1)
  895,767 
  664,425 
Average prices realized:
    
    
  Crude oil and condensate (per Bbl)
 $50.32 
 $42.21 
  Natural gas (per Mcf)
 $3.05 
 $2.45 
  Natural gas liquids (per Bbl)
 $26.08 
 $17.33 
 
(1)
Barrels of oil equivalent have been calculated on the basis of six thousand cubic feet (Mcf) of natural gas equal to one barrel of oil equivalent (Boe).
 
Revenues
 
The following table presents the Company’s revenues for the years ended December 31, 2017 and 2016.
 
  
 
Years Ended December 31,
 
 
 
2017
 
 
2016
 
Sales of natural gas and crude oil:
 
 
 
 
 
 
Crude oil and condensate
 $12,596,983 
 $7,260,169 
Natural gas
  9,425,676 
  5,697,879 
Natural gas liquids
  3,420,942 
  1,814,660 
Total revenues
 $25,443,601 
 $14,772,708 
 
Expenses
 
The Company’s lease operating expenses (“LOE”) and LOE per Boe for the years ended December 31, 2017 and 2016, are set forth below:
 
 
 
Years Ended December 31,
 
 
 
2017
 
 
2016
 
Lease operating expenses
 $6,715,337 
 $3,303,789 
Severance, ad valorem taxes and marketing
  4,321,976 
  2,259,841 
  Total LOE
 $11,037,313 
 $5,563,630 
 
    
    
LOE per Boe
 $12.32 
 $8.37 
LOE per Boe without severance, ad valorem taxes and marketing
 $7.50 
 $4.97 
 
 
2
 
 
Commodity Derivative Instruments
 
Commodity derivative instruments open as of December 31, 2017 are provided below. Natural gas prices are NYMEX Henry Hub prices, and crude oil prices are NYMEX West Texas Intermediate.
 
 
 
2018
 
 
2019
 
 
 
Settlement
 
 
Settlement (1)
 
NATURAL GAS (MMBtu):
 
 
 
 
 
 
Swaps
 
 
 
 
 
 
Volume
  1,725,133 
  373,906 
Price
 $3.00 
 $3.00 
 
    
    
CRUDE OIL (Bbls):
    
    
Swaps
    
    
Volume
  195,152 
  156,320 
Price
 $53.17 
 $53.77 
 
(1) Represents volumes through March 2019.
 
About Yuma Energy, Inc.
 
Yuma Energy, Inc., a Delaware corporation, is an independent Houston-based exploration and production company focused on acquiring, developing and exploring for conventional and unconventional oil and natural gas resources. Historically, the Company’s operations have focused on onshore properties located in central and southern Louisiana and southeastern Texas where it has a long history of drilling, developing and producing both oil and natural gas assets. More recently, the Company has begun acquiring acreage in Yoakum County, Texas, with plans to explore and develop oil and natural gas assets in the Permian Basin. Finally, the Company has operated positions in Kern County, California, and non-operated positions in the East Texas Woodbine and the Bakken Shale in North Dakota. Its common stock is listed on the NYSE American under the trading symbol “YUMA.”
 
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 (the “Exchange Act”). 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 future operations, and estimates of reserve and production volumes. Forward-looking statements are based on current expectations and assumptions and analyses made by the Company 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 risks of the oil and natural 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 natural gas deposits; the uncertainty of reserve estimates; revisions to reserve estimates as a result of changes in commodity prices; 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; declines in oil and natural 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.  The Company’s annual report on Form 10-K for the year ended December 31, 2017, and other SEC filings discuss some of the important risk factors identified that may affect its business, results of operations, and financial condition. The Company undertakes no obligation to revise or update publicly any forward-looking statements, except as required by law.
 
For more information, please contact:
 
James J. Jacobs
Executive Vice President, Treasurer and Chief Financial Officer
Yuma Energy, Inc.
1177 West Loop South, Suite 1825
Houston, TX 77027
Telephone: (713) 968-7000
 
 
 
 
3
 
 
Yuma Energy, Inc.
 
CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
 
 
December 31,
 
 
December 31,
 
 
 
2017
 
 
2016
 
 
 
 
 
 
 
 
ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT ASSETS:
 
 
 
 
 
 
Cash and cash equivalents
 $137,363 
 $3,625,686 
Accounts receivable, net of allowance for doubtful accounts:
    
    
Trade
  4,496,316 
  4,827,798 
Officer and employees
  53,979 
  68,014 
Other
  1,004,479 
  1,757,337 
Prepayments
  976,462 
  1,063,418 
Other deferred charges
  347,490 
  284,305 
 
    
    
Total current assets
  7,016,089 
  11,626,558 
 
    
    
OIL AND GAS PROPERTIES (full cost method):
    
    
Proved properties
  494,216,531 
  488,723,905 
Unproved properties - not subject to amortization
  6,794,372 
  3,656,989 
 
    
    
 
  501,010,903 
  492,380,894 
Less: accumulated depreciation, depletion and amortization
  (421,165,400)
  (410,440,433)
 
    
    
Net oil and gas properties
  79,845,503 
  81,940,461 
 
    
    
OTHER PROPERTY AND EQUIPMENT:
    
    
Land, buildings and improvements
  1,600,000 
  1,600,000 
Other property and equipment
  2,845,459 
  7,136,530 
 
  4,445,459 
  8,736,530 
Less: accumulated depreciation and amortization
  (1,409,535)
  (5,349,145)
 
    
    
Net other property and equipment
  3,035,924 
  3,387,385 
 
    
    
OTHER ASSETS AND DEFERRED CHARGES:
    
    
Deposits
  467,592 
  467,306 
Other noncurrent assets
  270,842 
  517,201 
 
    
    
Total other assets and deferred charges
  738,434 
  984,507 
 
    
    
TOTAL ASSETS
 $90,635,950 
 $97,938,911 
 
 
4
 
 
Yuma Energy, Inc.
 
CONSOLIDATED BALANCE SHEETS – CONTINUED
(Unaudited)
 
 
 
December 31,
 
 
December 31,
 
 
 
2017
 
 
2016
 
 
 
 
 
 
 
 
LIABILITIES AND EQUITY
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT LIABILITIES:
 
 
 
 
 
 
Current maturities of debt
 $651,124 
 $599,341 
Accounts payable, principally trade
  11,931,218 
  11,009,631 
Commodity derivative instruments
  903,003 
  1,340,451 
Asset retirement obligations
  277,355 
  376,735 
Other accrued liabilities
  2,295,438 
  2,572,680 
 
    
    
Total current liabilities
  16,058,138 
  15,898,838 
 
    
    
LONG-TERM DEBT
  27,700,000 
  39,500,000 
 
    
    
OTHER NONCURRENT LIABILITIES:
    
    
Asset retirement obligations
  10,189,058 
  9,819,648 
Commodity derivative instruments
  336,406 
  1,215,551 
Deferred rent
  290,566 
  - 
Employee stock awards
  191,110 
  - 
 
    
    
Total other noncurrent liabilities
  11,007,140 
  11,035,199 
 
    
    
COMMITMENTS AND CONTINGENCIES (Note 18)
    
    
 
    
    
EQUITY
    
    
Series D convertible preferred stock
    
    
($0.001 par value, 7,000,000 authorized, 1,904,391 issued and outstanding
    
    
as of December 31, 2017, and 1,776,718 issued and outstanding as of
    
    
December 31, 2016)
  1,904 
  1,777 
Common stock
    
    
($0.001 par value, 100 million shares authorized, 22,661,758 outstanding as of
    
    
December 31, 2017 and 12,201,884 outstanding as of December 31, 2016)
  22,662 
  12,202 
Additional paid-in capital
  55,064,685 
  43,877,563 
Treasury stock at cost (13,343 shares as of December 31, 2017 and -0- shares as
    
    
of December 31, 2016)
  (25,278)
  - 
Accumulated earnings (deficit)
  (19,193,301)
  (12,386,668)
 
    
    
Total equity
  35,870,672 
  31,504,874 
 
    
    
TOTAL LIABILITIES AND EQUITY
 $90,635,950 
 $97,938,911 
 
 
5
 
 
Yuma Energy, Inc.
 
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 
 
 
Years Ended December 31,
 
 
 
2017
 
 
2016
 
 
 
 
 
 
 
 
REVENUES:
 
 
 
 
 
 
Sales of natural gas and crude oil
 $25,443,601 
 $14,772,708 
 
    
    
EXPENSES:
    
    
Lease operating and production costs
  11,037,313 
  5,563,630 
General and administrative – stock-based compensation
  2,381,365 
  1,731,969 
General and administrative – other
  6,934,381 
  12,727,328 
Depreciation, depletion and amortization
  10,955,203 
  8,239,802 
Asset retirement obligation accretion expense
  557,683 
  254,573 
Impairment of oil and gas properties
  - 
  20,654,848 
Bad debt expense
  335,567 
  556,407 
Total expenses
  32,201,512 
  49,728,557 
 
    
    
LOSS FROM OPERATIONS
  (6,757,911)
  (34,955,849)
 
    
    
OTHER INCOME (EXPENSE):
    
    
Net gains (losses) from commodity derivatives
  2,554,934 
  (3,775,254)
Interest expense
  (1,734,807)
  (659,572)
Gain (loss) on other property and equipment
  484,768 
  (838,473)
Other, net
  60,248 
  55,779 
Total other income (expense)
  1,365,143 
  (5,217,520)
 
    
    
LOSS BEFORE INCOME TAXES
  (5,392,768)
  (40,173,369)
 
    
    
Income tax expense - deferred
  - 
  1,425,964 
 
    
    
NET LOSS
  (5,392,768)
  (41,599,333)
 
    
    
PREFERRED STOCK:
    
    
Dividends paid in kind
  1,413,865 
  1,323,641 
Loss on retirement of DPAC Series "A" Preferred Stock
  - 
  (271,914)
 
    
    
NET LOSS ATTRIBUTABLE TO
    
    
COMMON STOCKHOLDERS
 $(6,806,633)
 $(42,651,060)
 
    
    
LOSS PER COMMON SHARE:
    
    
Basic
 $(0.46)
 $(5.13)
Diluted
 $(0.46)
 $(5.13)
 
    
    
WEIGHTED AVERAGE NUMBER OF
    
    
COMMON SHARES OUTSTANDING:
    
    
Basic
  14,815,991 
  8,317,777 
Diluted
  14,815,991 
  8,317,777 
 
 
6
 
 
Yuma Energy, Inc.
 
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) 
 
 
 
Year Ended December 31,
 
 
 
2017
 
 
2016
 
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
 
 
 
Reconciliation of net income (loss) to net cash provided by (used in)
 
 
 
 
 
 
 operating activities:
 
 
 
 
 
 
Net income (loss)
 $(5,392,768)
 $(41,599,333)
Depreciation, depletion and amortization of property and equipment
  10,955,203 
  8,239,802 
Impairment of oil and gas properties
  - 
  20,654,848 
Amortization of debt issuance costs
  363,485 
  148,970 
Net deferred income tax expense
  - 
  1,425,964 
Deferred rent liability, net
  279,795 
  - 
Stock-based compensation expense
  2,381,365 
  1,731,969 
Settlement of asset retirement obligations
  (1,045,257)
  (287,902)
Asset retirement obligation accretion expense
  557,683 
  254,573 
Bad debt expense
  335,567 
  556,406 
Net (gains) losses from commodity derivatives
  (2,554,934)
  3,775,254 
(Gain) loss on sales of fixed assets
  (556,141)
  5,316 
Loss on write-off of abandoned facilities
  71,373 
  829,039 
(Gain) loss on write-off of liabilities net of assets
  (58,994)
  4,118 
Changes in assets and liabilities:
    
    
Decrease in accounts receivable
  285,051 
  3,698,004 
Decrease in prepaids, deposits and other assets
  86,670 
  353,889 
Decrease in accounts payable and other current and
    
    
non-current liabilities
  (2,462,040)
  (4,090,155)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
  3,246,058 
  (4,299,238)
 
    
    
CASH FLOWS FROM INVESTING ACTIVITIES:
    
    
Capital expenditures for oil and gas properties
  (10,704,535)
  (10,066,999)
Proceeds from sale of oil and gas properties
  5,400,563 
  1,152,958 
Merger with Yuma California
  - 
  1,887,426 
Proceeds from sale of other fixed assets
  645,791 
  - 
Derivative settlements
  1,238,341 
  1,607,365 
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
  (3,419,840)
  (5,419,250)
 
    
    
CASH FLOWS FROM FINANCING ACTIVITIES:
    
    
Proceeds from borrowings on senior credit facility
  13,275,000 
  18,700,000 
Repayment of borrowings on senior credit facility
  (25,075,000)
  (9,000,000)
Proceeds from borrowings - insurance financing
  763,244 
  247,013 
Repayments of borrowings - insurance financing
  (711,461)
  (49,625)
Debt issuance costs
  (353,593)
  (208,985)
Proceeds net of costs from common stock offering
  8,812,547 
  - 
Treasury stock repurchases
  (25,278)
  (408,323)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
  (3,314,541)
  9,280,080 
 
    
    
NET DECREASE IN CASH AND CASH EQUIVALENTS
  (3,488,323)
  (438,408)
 
    
    
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
  3,625,686 
  4,064,094 
 
    
    
CASH AND CASH EQUIVALENTS AT END OF YEAR
 $137,363 
 $3,625,686 
 
    
    
Supplemental disclosure of cash flow information:
    
    
Interest payments (net of interest capitalized)
 $1,369,353 
 $590,160 
Interest capitalized
 $317,691 
 $26,121 
Income tax refund
 $20,699 
 $- 
Supplemental disclosure of significant non-cash activity:
    
    
(Increase) decrease in capital expenditures financed by accounts payable
 $(2,608,232)
 $323,910 
 
 
 
7
 
 
Yuma Energy, Inc.
 
Reconciliation of GAAP to Non-GAAP Financial Measures
Unaudited
 
Non-GAAP Financial Measures
 
The non-GAAP financial measure of PV10, as calculated by the Company below, is intended to provide readers with meaningful information that supplements our financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). These disclosures may not be comparable to similarly titled measures used by other companies. Further, this non-GAAP measure should only be considered in conjunction with financial statements and disclosures prepared in accordance with GAAP and should not be considered in isolation or as a substitute for GAAP measures, such as net income or loss, operating income or loss, standardized measure of discounted future net cash flows or any other GAAP measure of financial position or results of operations.
 
PV10
 
Present Value Discounted at 10% (“PV10”) is a Non-GAAP measure that differs from the GAAP measure “standardized measure of discounted future net cash flows” in that PV10 is calculated without regard to future income taxes. Management believes that the presentation of the PV10 value is relevant and useful to investors because it presents the estimated discounted future net cash flows attributable to the Company’s estimated proved reserves independent of its income tax attributes, thereby isolating the intrinsic value of the estimated future cash flows attributable to the Company’s reserves. Because many factors that are unique to each individual company impact the amount of future income taxes to be paid, the Company believes the use of a pre-tax measure provides greater comparability of assets when evaluating companies. For these reasons, management uses, and believes the industry generally uses, the PV10 measure in evaluating and comparing acquisition candidates and assessing the potential return on investment related to investments in oil and natural gas properties. PV10 does not necessarily represent the fair market value of oil and natural gas properties.
 
PV10 is not a measure of financial or operational performance under GAAP, nor should it be considered in isolation or as a substitute for the standardized measure of discounted future net cash flows as defined under GAAP. The table below provides a reconciliation of the Company’s PV10 to the standardized measure of discounted future net cash flows ($ in thousands).
 
Present value of estimated future net revenues (PV10)
 $72,903 
Future income taxes discounted at 10%
  - 
Standardized measure of discounted future net cash flows
 $72,903 
 
 
 
 
8

The following information was filed by Yuma Energy, Inc. (YUMA) on Monday, April 2, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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