FieldPoint Petroleum Corporation Reports First Quarter Results
Date : 05/18/2009 @ 11:10AM
FieldPoint Petroleum Corporation (AMEX:FPP) announced today its first quarter financial results for the three months ended March 31, 2009.
Ray Reaves, President and CEO of FieldPoint, stated, “While net income and earnings per share were below our goals for this quarter, we still believe that this will be a very significant year for FieldPoint. During this past quarter our revenues declined 58% as a result of much lower oil and natural gas prices, combined with a slight decrease in production. As previously stated, during the past year we significantly improved our balance sheet and prepared the company for dealing with lower commodity prices.”
Financial Highlights for the Three Months Ended March 31, 2009 Compared to the Three Months Ended March 31, 2008:
Revenues decreased 58% to $634,682 from $1,509,122;
Net Income decreased from $349,849 to a loss of $(79,387); and
Earnings per share, both basic and fully diluted, decreased from $0.04 to a loss of $(0.01).
Mr. Reaves continued, “FieldPoint has a solid cash position which should continue to grow. The results from this quarter emphasize the effect that market fluctuations have on our financial performance. While downward price movement has been negative to us so far this year, it also serves to remind us of the importance of continuing to build our production base. Fortunately, FieldPoint is well positioned financially to allow management to continue its commitment to develop new programs that can materially expand our production levels. To this end, we plan to continue to diligently search for acquisition and development opportunities and anticipate some level of success in this regard during 2009. We are very optimistic that the remainder of this year will be an important growth stage for FieldPoint.”
The decrease in revenue is attributed to much lower oil and natural gas prices, which averaged approximately $36.50 per barrel and $5.35 per MCF in 2009, compared to $92.65 per barrel and $6.97 per MCF in the prior year. Overall production for the year decreased on a barrel of oil equivalent (BOE) basis, as compared to the 2008 period. Primarily a 61% decrease in oil prices, led to the decrease in revenues.
Lease operating expenses decreased 27% or $113,439, due primarily to the decreases in workover expense and remedial repairs. As a result of the reduction in lease operating expense compared to the quarter ended March 31, 2008, lifting cost per BOE decreased 19% or $4.36 to $18.12 for the period. We anticipate lease operating expenses to increase over the following quarters due to additional remedial repairs and workover expense designed to increase production.
Depletion and depreciation decreased 38% or $102,000 to $163,000 for the three month period ended March 31, 2009 versus $265,000 in the 2008 comparable period. This was primarily due to impairments in 2008 which lowered our depletable base and by lower production and higher reserves.
General and administrative overhead cost increased 16% or $26,003 to $188,258 for the three-month period ended March 31, 2009 from the three-month period ended March 31, 2008. This was primarily attributable to an increase in legal fees and professional services related to the Basic Earth Science Systems Tender offer during the 2009 period. Due to the stable environment of the Company, we anticipate general and administrative expenses to remain materially constant in the coming quarters.
Other expenses, net for the quarter ended March 31, 2009, were $86,607 compared to other expenses, net of $117,375 for 2008. The decrease was primarily due to a decrease in interest expense associated with our line of credit for the period ending March 31, 2009. We had approximately $3.5 million outstanding under our line of credit at March 31, 2008, compared with $1.7 million at March 31, 2009.
