PANHANDLE OIL AND GAS INC. reports second quarter and six months 2012 results and mid-year reserve update

PANHANDLE OIL AND GAS INC. (NYSE: PHX) today reported financial and operating results for the Company’s fiscal second quarter and six months ended March 31, 2012.
FISCAL SECOND QUARTER 2012 RESULTSFor the quarter ending March 31, 2012, the Company recorded a net income of $675,966, $.08 per share, as compared to a net income of $1,772,253, $.21 per share, for the 2011 second quarter.  Total revenues for the 2012 quarter decreased to $10,436,910, or 5%, as compared to the 2011 quarter.  Cash provided by operating activities totaled $7,316,108, while capital expenditures for drilling and equipping wells amounted to $5,730,985.  Production for the 2012 quarter increased 23% to 2,654,485 Mcfe, as compared to 2,152,011 Mcfe for the 2011 quarter.  The major factor causing the decline in revenues and net income for the 2012 quarter was the average per Mcfe sales price decrease of 29% to $3.60, as compared to $5.07 for the 2011 quarter. The Company continued to increase its oil and natural gas liquids production, which now accounts for 13% of Mcfe production, and expects to continue this trend during the remainder of fiscal 2012.

SIX MONTHS 2012 RESULTSFor the six months ended March 31, 2012, the Company recorded a net income of $4,088,076, $.49 per share, as compared to a net income of $3,199,102, $.38 per share, for the 2011 six months.  Total revenues for the 2012 six months increased to $23,841,243, or 14%, as compared to the 2011 six months.  For the 2012 six months, cash provided by operating activities totaled $15,061,760, which more than funded drilling capital expenditures of $12,074,991.  Production for the 2012 six months totaled 5,214,009 Mcfe as compared to 4,360,229 Mcfe for the 2011 six months.  The average per Mcfe sales price decreased 14% for the 2012 six months to $4.09 as compared to $4.73 for the 2011 six months.  The 2012 six-month revenue increase was principally the result of lease bonuses and rentals of $1,921,918 received in the 2012 six months, as compared to $141,855 in the 2011 six months.  $1,714,000 of lease bonus was one transaction in which the Company leased 2,431 net acres of its mineral acres in the Mississippian play in northern Oklahoma.  The Company also retained a 3/16 non-cost-bearing royalty in any production established on these acres, while retaining ownership of its mineral acres.

SOURCE PANHANDLE OIL AND GAS INC.

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