Earthstone Energy Reports 1st Quarter Results

Marketwired

DENVER, CO--(Marketwire -08/10/12)- EARTHSTONE ENERGY, INC. (ESTE) reported net income of $270,000, or $0.16 per diluted share, on revenue of $2,347,000 for the first quarter of fiscal 2013, ended June 30, 2012 (2012). This compares to net income of $665,000, or $0.39 per diluted share, on revenue of $2,525,000 for the first quarter of fiscal 2012, ended June 30, 2011 (2011). Both total revenue and net income decreased $178,000 (7%) and $395,000 (59%), respectively, from 2011. These decreases were primarily due to lower oil and natural gas prices in 2012 relative to 2011. Net income was also affected by higher general & administrative expenses when contrasted with the comparable quarter in 2011. Other factors which contributed to the quarterly results are disclosed in the Company's most recent Form 10-Q.

"We continue to pursue our strategy of increasing production and reserves despite a softening in oil prices," commented Ray Singleton, President of Earthstone. "In that regard, we were especially pleased to generate a six percent (6%) increase in production and add ownership interests in four new gross wells to our reserve base. We expect to add ownership interests in that many wells, if not more, by the end of our second quarter. Since last year, our exploration activity has increased dramatically with our capital deployment for the first quarter up nearly 150% over the same quarter last year. Overall, we believe our capital expenditure for fiscal 2013 will meet or exceed last year's disbursements. Certainly, our undeveloped Bakken acreage in the Banks Field is leading the way. We are excited about what the next few months and quarters will bring as our acreage and projects in other areas are exposed to increased activity and our projects begin to produce results. The most interesting of these include our horizontal Ratcliffe play in Brush Mountain and our undeveloped acreage in Sheridan County, Montana. With a number of efforts both underway and in the planning process, we are excited about the potential we see to increase the Company's profitability and cash flow in the coming year."

Singleton further stated, "This year's annual meeting will be held in Denver on September 27th. Our "Notice and Access Materials" will be delivered to our shareholders in the near future. We encourage all of our Shareholders to attend our Annual Meeting and enjoy the many attractions our city and mountains have to offer."

ABOUT EARTHSTONE ENERGY:
Earthstone Energy, Inc. is a growth-oriented independent oil and gas exploration and production company with primary operations in the Williston Basin and southern Texas. Earthstone is currently traded on NYSE MKT under the symbol ESTE. Information on Earthstone can be found at its web site: www.earthstoneenergy.com.

THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. Some statements contained in this release are forward-looking, and therefore involve uncertainties or risks that could cause actual results to differ materially. Forward-looking statements can be identified by words such as "should," "may," "will," "anticipate," "expect," "estimate," "intend" or "continue," or comparable words or phrases. In addition, all statements other than statements of historical facts that address activities that Earthstone intends, expects or anticipates will or may occur in the future are forward-looking statements. Forward-looking statements also include comments regarding assumptions regarding production rates and growth, operating costs, reduction of operation costs, commodity prices, industry outlook, future drilling activities, acquisitions and industry opportunities. Factors that could cause actual results to differ materially include availability of rigs and services, price volatility of oil and gas, estimated production rates and adjustments to ownership percentages in addition to economic and political events affecting supply and demand for oil and gas, loss of customers for oil and gas production and government regulations. These and other factors are discussed in more detail in Earthstone Energy's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K filed for March 31, 2012 and Quarterly Report on Form 10-Q for the three months ended June 30, 2012. The Company disclaims any obligation to update forward-looking statements.

 
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FINANCIAL & OPERATING HIGHLIGHTS
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Three Months Ended
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June 30,
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2012 2011
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Revenue $ 2,347,000 $ 2,525,000
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Net income $ 270,000 $ 665,000
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Basic net income per share $ 0.16 $ 0.39
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Diluted net income per share $ 0.16 $ 0.39
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Production
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Oil (barrels) 26,999 22,562
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Gas (mcf) 14,566 31,403
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Production expense $ 1,030,000 $ 933,000
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Average sales price
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Oil (per barrel) $ 78.82 $ 96.93
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Gas (per mcf) $ 6.32 $ 9.33
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Average per BOE*
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Production expense** $ 35.00 $ 33.57
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*Barrel of oil equivalent
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**Lease/Workover Expense & Severance Taxes
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Contact:
Contact Information:
Ray Singleton
303-296-3076, ext. 102

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