Ring Energy, Inc. (NYSE MKT:REI) Q2 2020 Earnings Conference Call - Final Transcript

Aug 11, 2020 • 11:00 am ET

Previous

Ring Energy, Inc. (NYSE MKT:REI) Q2 2020 Earnings Conference Call - Final Transcript

Share
Close

Loading Event

Loading Transcript

Presentation
Operator
Operator

Greetings, and welcome to the Ring Energy, Inc. 2020 Second Quarter Financial and Operating Highlights Conference Call. [Operator Instructions] A question-and-answer session will follow the formal presentation. [Operator Instructions]

I will now turn the conference over to your host, Mr. Tim Rochford, Chairman of the Board of Directors of Ring Energy. Thank you, sir. You may begin.

Executive
Lloyd T. Rochford

Thank you. Thank you, operator. And I want to thank all of our listeners today for the 2020 second quarter financial and operations conference call for Ring Energy, Inc. Again, I'm Tim Rochford, Chairman of the Board.

Joining me on the call today is Kelly Hoffman, our CEO; David Fowler, our President; Randy Broaddrick, our Chief Financial Officer; Daniel Wilson, Executive VP and Head of Operations; Hollie Lamb, Vice President of Engineering; Matt Garner, who's VP of Land; and Bill Parsons, Head of Investor Relations.

So today, we'll provide a quick, concise overview of the financial and operational results for the three months as well as the six months ended June 30, 2020. And as we have done in the past two quarters, we'll spend the majority of this call identifying, discussing and summarizing the factors that directly affect the current and future operations of your company. At the conclusion of the second quarter review, we'll turn it back over to the operator, and we'll open it up for any questions that you may have.

Now with that said, I'm going to turn this over to Randy Broaddrick for just a brief financial overview. Randy, please?

Executive
William R. Broaddrick

Thank you, Tim. Before we begin, I would like to make reference that any forward-looking statements, which may be made during this call are within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For a complete explanation, I would refer you to our release issued Monday, August 10. If you do not have a copy of the release, one will be posted on the company website at www.ringenergy.com.

For the three months ended June 30, 2020, we had revenues of $10.6 million, net loss of $135 million and loss per diluted share of $1.99. This net loss included a pretax unrealized loss on hedges of $26.8 million, $147.9 million in ceiling test impairment and $1.3 million in stock-based compensation expense. Without these items, after the effect of income taxes, our net income would have been approximately $1.5 million or $0.02 per share.

For the six months ended June 30, 2020, we had revenues of $50.2 million, net loss of $91.2 million and loss per diluted share of $1.34. This net loss included a pretax unrealized gain on hedges of $20.3 million, $147.9 million in ceiling test impairment and $2 million in stock-based compensation expense. Without these items, after the effect of income taxes, our net income would have been approximately $9.2 million or $0.14 per share.

The unrealized gain or loss on hedges is recorded because the value of derivatives changed as a result of the changes in oil prices.