PR Newswire | Aug 13, 2020 04:30PM EDT

And Announces Dividend Payment

08/13 15:30 CDT

PANHANDLE OIL AND GAS INC. Reports Third Quarter And Nine Months 2020 Results And Announces Dividend Payment OKLAHOMA CITY, Aug. 13, 2020

OKLAHOMA CITY, Aug. 13, 2020 /PRNewswire/ -- PANHANDLE OIL AND GAS INC., "Panhandle" or the "Company," (NYSE: PHX), today reported financial and operating results for the third quarter and nine months ended June 30, 2020.

Chad L. Stephens, President and CEO, commented, "Clearly the third quarter was challenging given the effects of the global pandemic on the economy and the energy markets. Our sales volumes were down as operators curtailed production and brought fewer wells online due to low commodity prices. While we have made significant strides in reducing costs in the quarter, it was not enough to offset lower revenue. In spite of these challenges, we managed to generate free cash flow which we used to further reduce debt. The energy sector is stabilizing as the rig count seems to have found a floor and operators are talking about bringing curtailed wells back on line and setting reasonable drilling plans going forward. The deal flow for mineral assets is also picking up, and we expect more opportunities to come to market in the second half of 2020. We will continue to focus on areas that we can control such as cost discipline, debt reduction and sourcing mineral acquisition opportunities, which we believe will create value for our shareholders in the long run."

SUMMARY OF RESULTS FOR THE PERIODS ENDED JUNE 30, 2020, AND SUBSEQUENT EVENTS

* Total volumes sold decreased in the third quarter 2020 by 0.47 Bcfe, or 20%, and royalty volumes decreased by 0.16 Bcfe, or 16%, from the second quarter 2020, primarily due to timing of payments from operators as a higher number of new wells were paid in the second quarter compared to the third quarter. * Net loss in the third quarter 2020 was $3.6 million, or $0.21 per share, as compared to net loss of $20.5 million, or $1.24 per share, in the second quarter 2020. * Adjusted EBITDA(1) for the third quarter 2020 was $1.2 million, as compared to $2.4 million in the second quarter 2020, mainly due to 20% lower production volumes and 39% lower realized prices. * Reduced debt from $35.4 million, as of Sept. 30, 2019, to $30.0 million, as of June 30, 2020. Net debt has been further reduced to approximately $26.9 million as of Aug. 11, 2020. * Debt to adjusted EBITDA (TTM) ratio was 1.48x at June 30, 2020. * Subsequent to June 30, 2020, the Company sold 5,925 open and non-producing net mineral acres for $793,617 with the proceeds applied toward further debt reduction. * Total G&A decreased by $265,871 from the second quarter as a result of the Company's ongoing cost reduction efforts. * Approved a payment of a one cent per share dividend payable on Sept. 11, 2020, to stockholders of record on Aug. 27, 2020.

(1) This is a non-GAAP measure. Refer to the Non-GAAP Reconciliation section.

OPERATING HIGHLIGHTS

Third Quarter Ended Third Quarter Ended Nine Months Ended Nine Months Ended

June 30, 2020 June 30, 2019 June 30, 2020 June 30, 2019

Mcfe Sold 1,903,752 2,618,369 6,555,378 7,804,424

Average Sales Price per Mcfe $ 1.85 $ 3.74 $ 2.80 $ 4.00

Oil Barrels Sold 55,138 96,065 214,159 253,265

Average Sales Price per Barrel $ 25.94 $ 57.50 $ 42.43 $ 55.01

Gas Mcf Sold 1,361,909 1,718,561 4,539,103 5,300,594

Average Sales Price per Mcf $ 1.36 $ 2.00 $ 1.73 $ 2.68

NGL Barrels Sold 35,169 53,903 121,887 164,040

Average Sales Price per Barrel $ 6.62 $ 15.33 $ 11.26 $ 18.88

FINANCIAL HIGHLIGHTS

Third Quarter Ended Third Quarter Ended Nine Months Ended Nine Months Ended

June 30, 2020 June 30, 2019 June 30, 2020 June 30, 2019

Working Interest Sales $ 1,876,489 $ 6,659,237 $ 9,976,274 $ 20,164,713

Royalty Interest Sales $ 1,641,072 $ 3,123,100 $ 8,352,743 $ 11,049,662

Oil, NGL and Natural Gas Sales $ 3,517,561 $ 9,782,337 $ 18,329,017 $ 31,214,375

Lease Bonuses and Rental Income $ 22,996 $ 229,075 $ 572,787 $ 952,378

Total Revenue $ 2,705,383 $ 16,342,394 $ 24,593,201 $ 50,307,601

LOE per Mcfe $ 0.60 $ 0.62 $ 0.59 $ 0.59

Transportation, Gathering and Marketing per Mcfe $ 0.50 $ 0.58 $ 0.56 $ 0.59

Production Tax per Mcfe $ 0.07 $ 0.19 $ 0.13 $ 0.20

G&A Expense per Mcfe $ 1.00 $ 0.69 $ 0.96 $ 0.75

Interest Expense per Mcfe $ 0.13 $ 0.20 $ 0.15 $ 0.20

DD&A per Mcfe $ 1.29 $ 1.67 $ 1.34 $ 1.51

Total Expense per Mcfe $ 3.59 $ 3.95 $ 3.73 $ 3.84

Impairment $ 358,826 $ - $ 29,904,528 $ -

Net Income (Loss) $ (3,555,215) $ 4,604,236 $ (22,117,915) $ 15,408,842

Adj. Pre-Tax Net Income (Loss) ^(1) $ (1,536,925) $ 4,024,933 $ 990,306 $ 14,039,317

Adjusted EBITDA ^(1) $ 1,168,834 $ 8,934,653 $ 10,742,522 $ 27,411,853

Cash Flow from Operations $ 3,717,398 $ 5,271,897 $ 9,825,740 $ 14,332,951

CapEx - Drilling & Completing $ 56,413 $ (810,043) $ 196,168 $ 3,349,640

CapEx - Mineral Acquisitions $ 50,000 $ 3,310,691 $ 10,304,016 $ 5,120,466

Borrowing Base $ 32,000,000 $ 80,000,000

Debt $ 30,000,000 $ 41,500,000

Debt/Adjusted EBITDA (TTM) ^(1) 1.48 1.26

^(1) This is a non-GAAP measure. Refer to the Non-GAAP Reconciliation section.

RESULTS OF THIRD QUARTER 2020 COMPARED TO THIRD QUARTER 2019

The Company recorded a third quarter 2020 net loss of $3,555,215, or $0.21 per share, as compared to net income of $4,604,236, or $0.28 per share, in the 2019 quarter. The decrease was principally the result of decreased oil, NGL and natural gas sales, loss on derivative contracts in the third quarter and decreased gain on asset sales, partially offset by a decrease in DD&A, transportation, gathering and marketing expenses, production taxes and changes in tax provision (benefit).

Oil, NGL and natural gas sales decreased $6,264,776, or 64%, for the 2020 quarter due to decreases in oil, NGL and natural gas prices of 55%, 57% and 32%, respectively, and decreases in oil, NGL and natural gas sales volumes of 43%, 35% and 21%, respectively.

Although production is down in all three product categories, it is notable that production is down for working interest volumes and slightly up for royalty interest volumes due to new royalty interest wells brought online, as compared to June 30, 2019. The primary factor for the oil production decrease is attributable to the Eagle Ford Shale working interest wells, where the natural decline on new wells brought online in March 2019 is coupled with recent delays in performing mechanical repairs due to poor economics related to low oil prices. Decreases are also attributable to the natural decline of the working interest production base. NGL production decline is attributable to curtailed production along with the natural decline of the working interest production base in liquid-rich gas areas of the STACK, SCOOP and Arkoma Stack. Natural gas volumes have decreased as a result of curtailments in response to market conditions in the STACK, SCOOP and Arkoma Stack, in addition to the natural decline of working interest production base in all the areas. New royalty interest production has increased, even though we have experienced reduced activity as a result of market conditions; this increase is primarily associated with mineral acquisitions and new wells brought online. While we cannot estimate the curtailed volumes or timing, we expect the deferred production to resume to normal rates as market conditions and prices improve.

The Company had a net loss on derivative contracts of $838,282 in the 2020 quarter as compared to a net gain of $2,313,195 in the 2019 quarter. During the 2020 quarter, oil and natural gas collars and fixed price swaps experienced an unfavorable change as NYMEX futures experienced an increase in price during the quarter in relation to their previous position to the collars and the fixed prices of the swaps at the beginning of the 2020 quarter.

The 9% decrease in total cost per Mcfe in the 2020 quarter relative to the 2019 quarter was primarily driven by a decrease in DD&A. DD&A decreased $1,918,475 or 44% in the 2020 quarter to $1.29 per Mcfe as compared to $1.67 per Mcfe in the 2019 quarter. $1,193,410 of the decrease was a result of production decreasing 27% in the 2020 quarter. Also, DD&A decreased $725,065 as a result of a $0.38 decrease in the DD&A rate per Mcfe due to impairments taken at the end of fiscal 2019 and the 2020 second quarter, which lowered the basis of the assets. The rate decrease was partially offset by lower oil, NGL and natural gas prices utilized in the reserve calculations during the 2020 quarter, as compared to the 2019 quarter, shortening the economic life of wells.

RESULTS OF NINE MONTHS ENDED JUNE 30, 2020, COMPARED TO NINE MONTHS ENDED JUNE 30, 2019

The Company recorded a nine-month net loss of $22,117,915, or $1.34 per share, in the 2020 period, as compared to net income of $15,408,842, or $0.92 per share, in the 2019 period. The decrease was principally the result of increased provision for impairment (non-cash), decreased oil, NGL and natural gas sales, decreased gains on derivative contacts and decreased gain on asset sales, partially offset by decreased lease operating expenses, decreased transportation, gathering and marketing expenses, decreased production taxes, decreased DD&A and changes in our tax provision (benefit).

Oil, NGL and natural gas sales decreased $12,885,358, or 41%, for the 2020 period due to decreases in oil, NGL and natural gas prices of 23%, 40% and 35%, respectively, and decreases in oil, NGL and natural gas sales volumes of 15%, 26% and 14%, respectively.

Total production decreased 16% in the 2020 period, as compared to the 2019 period. This decrease for the 2020 nine-month period, was the result of Panhandle electing not to participate with a working interest on 18 wells proposed on its mineral and leasehold acreage, as well as the factors for the third quarter 2020 results discussed above.

The 3% decrease in total cost per MCFE in the 2020 period, relative to the 2019 period, was primarily driven by a decrease in DD&A as noted above.

OPERATIONS UPDATE

During the quarter ended June 30, 2020, we converted 48 gross/0.22 net wells in progress to producing wells. Our inventory of wells in progress decreased to 85 gross wells and 0.44 net wells, as drilling has slowed down due to the current pricing environment. Permits outstanding decreased due to current economics.

Bakken /

SCOOP/ Three Arkoma

STACK Forks Stack Permian Fayetteville Other Total

Gross Wells in Progress on PHX Acreage:

As of 3/31/20 91 2 4 5 - 16 118

Net Change -22 - -3 -1 -7 -33

As of 6/30/20 69 2 1 4 - 9 85

Net Wells in Progress on PHX Acreage:

As of 3/31/20 0.27 - 0.01 0.15 - 0.07 0.50

Net Change -0.04 -0.01 -0.01 - - -0.06

As of 6/30/20 0.23 - - 0.14 - 0.07 0.44

Gross Active Permits on PHX Acreage:

As of 3/31/20 39 13 10 - - 16 78

Net Change -1 -2 -1 - -3 -7

As of 6/30/20 38 11 9 - - 13 71

As of 6/30/20:

Rigs Present on PHX Acreage - - - - - - -

Rigs Within 2.5 Miles of PHX Acreage 10 4 - 1 - - 15

Leasing Activity

During the third quarter of fiscal 2020, Panhandle leased 120 net mineral acres for an average bonus payment of $188 per net mineral acre and an average royalty of 19%.

Bakken /

SCOOP Three Arkoma /

STACK Forks Stack Permian Fayetteville Other Total

During Three Months Ended 6/30/20:

Net Mineral Acres Leased 36 - 44 - - 40 120

Average Bonus per Net Mineral Acre $ 125 - $ 300 - - $ 25 $ 188

Average Royalty per Net Mineral Acre 22% - 19% - - 13% 19%

ACQUISITION AND DIVESTITURE UPDATE

During the third quarter of fiscal 2020, Panhandle did not purchase any net mineral acres or sell any net mineral acres.

THIRD QUARTER EARNINGS CALL

Panhandle will host a conference call to discuss third quarter results at 5:00 p.m. EDT on Aug. 13, 2020. Management's discussion will be followed by a question and answer session with investors. To participate on the conference call, please dial 844-602-0380 (domestic) or 862-298-0970 (international). A replay of the call will be available for seven days after the call. The number to access the replay of the conference call is 877-481-4010 and the PIN for the replay is 35580.

FINANCIALS



Statements of Operations

Three Months Ended June 30, Nine Months Ended June 30,

2020 2019 2020 2019

Revenues:

Oil, NGL and natural gas sales $ 3,517,561 $ 9,782,337 $ 18,329,017 $ 31,214,375

Lease bonuses and rental income 22,996 229,075 572,787 952,378

Gains (losses) on derivative contracts (838,282) 2,313,195 2,415,401 5,026,123

Gain on asset sales 3,108 4,017,787 3,275,996 13,114,725

2,705,383 16,342,394 24,593,201 50,307,601

Costs and expenses:

Lease operating expenses 1,147,948 1,619,690 3,871,818 4,639,749

Transportation, Gathering and Marketing 956,653 1,529,270 3,696,282 4,601,959

Production taxes 134,249 488,779 835,284 1,565,038

Depreciation, depletion and amortization 2,464,568 4,383,043 8,793,787 11,820,705

Provision for impairment 358,826 - 29,904,528 -

Interest expense 241,191 526,677 958,429 1,551,831

General and administrative 1,908,790 1,809,439 6,306,479 5,881,432

Other expense (income) (73,687) 66,260 (44,551) 82,045

7,138,538 10,423,158 54,322,056 30,142,759

Income (loss) before provision (benefit) for income taxes (4,433,155) 5,919,236 (29,728,855) 20,164,842

Provision (benefit) for income taxes (877,940) 1,315,000 (7,610,940) 4,756,000

Net income (loss) $ (3,555,215) $ 4,604,236 $ (22,117,915) $ 15,408,842

Basic and diluted earnings (loss) per common share $ (0.21) $ 0.28 $ (1.34) $ 0.92

Basic and diluted weighted average shares outstanding:

Common shares 16,403,243 16,515,498 16,375,736 16,646,828

Unissued, directors' deferred compensation shares 141,799 170,066 152,500 183,206

16,545,042 16,685,564 16,528,236 16,830,034

Dividends declared per share of

common stock and paid in period $ 0.01 $ 0.04 $ 0.09 $ 0.12

Balance Sheets

June 30, 2020 Sept. 30, 2019

Assets

Current assets:

Cash and cash equivalents $ 2,025,081 $ 6,160,691

Oil, NGL and natural gas sales receivables (net of 2,183,216 4,377,646

allowance for uncollectable accounts)

Refundable income taxes 1,640,350 1,505,442

Derivative contracts, net 1,819,977 2,256,639

Other 490,697 177,037

Total current assets 8,159,321 14,477,455

Net properties and equipment, based on successful efforts method of accounting 83,038,001 111,427,021

Investments 113,408 205,076

Derivative contracts, net - 237,505

Deferred income taxes, net 181,993 -

Other, net 231,387 297,890

Total assets $ 91,724,110 $ 126,644,947

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payable $ 724,289 $ 665,160

Accrued liabilities and other 1,485,708 2,433,466

Short-term debt 2,000,000 -

Total current liabilities 4,209,997 3,098,626

Long-term debt 28,000,000 35,425,000

Deferred income taxes - 5,976,007

Asset retirement obligations 2,871,603 2,835,781

Derivative contracts, net 140,466 -

Stockholders' equity:

Class A voting common stock, $0.01666 par value; 24,000,500

shares authorized; 16,897,306 issued at June 30, 2020, and

Class A voting common stock, $0.01666 par value; 24,000,000

shares authorized; 16,897,306 issued at Sept. 30, 2019 281,509 281,509

Capital in excess of par value 3,375,400 2,967,984

Deferred directors' compensation 1,829,786 2,555,781

Retained earnings 58,244,355 81,848,301

63,731,050 87,653,575

Less treasury stock, at cost; 483,588 shares at June 30,

2020, and 558,051 shares at Sept. 30, 2019 (7,229,006) (8,344,042)

Total stockholders' equity 56,502,044 79,309,533

Total liabilities and stockholders' equity $ 91,724,110 $ 126,644,947

Condensed Statements of Cash Flows

Nine months ended June 30,

2020 2019

Operating Activities

Net income (loss) $ (22,117,915) $ 15,408,842

Adjustments to reconcile net income (loss) to net cash provided

by operating activities:

Depreciation, depletion and amortization 8,793,787 11,820,705

Impairment of producing properties 29,904,528 -

Provision for deferred income taxes (6,158,000) 5,150,000

Gain from leasing of fee mineral acreage (567,975) (951,832)

Proceeds from leasing of fee mineral acreage 582,458 967,337

Net (gain) loss on sale of assets (3,258,994) (13,114,725)

Directors' deferred compensation expense 184,188 197,820

Total (gain) loss on derivative contracts (2,415,401) (5,026,123)

Cash receipts (payments) on settled derivative contracts 3,230,034 (1,099,402)

Restricted stock awards 619,812 606,232

Other 3,718 15,848

Cash provided (used) by changes in assets and liabilities:

Oil, NGL and natural gas sales receivables 2,194,430 1,597,667

Other current assets (121,635) (859,258)

Accounts payable 31,755 3,270

Income taxes receivable (134,908) (476,846)

Other non-current assets 6,544 6,949

Accrued liabilities (950,686) 86,467

Total adjustments 31,943,655 (1,075,891)

Net cash provided by operating activities 9,825,740 14,332,951

Investing Activities

Capital expenditures (196,168) (3,349,640)

Acquisition of minerals and overrides (10,304,016) (5,120,466)

Investments in partnerships - (1,648)

Proceeds from sales of assets 3,457,500 13,114,969

Net cash provided (used) by investing activities (7,042,684) 4,643,215

Financing Activities

Borrowings under debt agreement 6,061,725 15,053,345

Payments of loan principal (11,486,725) (24,553,345)

Purchase of treasury stock (7,635) (6,465,186)

Payments of dividends (1,486,031) (2,013,005)

Net cash provided (used) by financing activities (6,918,666) (17,978,191)

Increase (decrease) in cash and cash equivalents (4,135,610) 997,975

Cash and cash equivalents at beginning of period 6,160,691 532,502

Cash and cash equivalents at end of period $ 2,025,081 $ 1,530,477

Supplemental Schedule of Noncash Investing and Financing Activities

Additions and revisions, net, to asset retirement obligations $ 4 $ 27,782

Gross additions to properties and equipment $ 10,335,534 $ 8,149,347

Net (increase) decrease in accounts payable for properties

and equipment additions 164,650 320,759

Capital expenditures and acquisitions $ 10,500,184 $ 8,470,106

Derivative Contracts as of Aug. 11, 2020

Volume Mcf/ Swap Collar CollarPeriod Product Bbl Price Average Average Floor Price Ceiling Price

2020 Natural Gas 469,500 $ 2.30 $ 2.98

2020 Natural Gas 414,500 $ 2.68

2021 Natural Gas 2,424,500 $ 2.30 $ 3.00

2021 Natural Gas 1,014,500 $ 2.69

2022 Natural Gas 202,500 $ 2.30 $ 3.02

2022 Natural Gas 125,500 $ 2.70

2020 Crude Oil 21,500 $ 45.19 $ 52.55

2020 Crude Oil 50,000 $ 58.02

2021 Crude Oil 43,500 $ 36.69 $ 44.39

2021 Crude Oil 96,000 $ 37.00

2022 Crude Oil 13,000 $ 36.81 $ 44.62

Non-GAAP Reconciliation

This news release includes certain "non-GAAP financial measures" under the rules of the Securities and Exchange Commission, including Regulation G. These non-GAAP measures are calculated using GAAP amounts in our financial statements.

Adjusted EBITDA Reconciliation

Adjusted EBITDA is defined as net income (loss) plus interest expense, provision for impairment, depreciation, depletion and amortization of properties and equipment, including amortization of other assets, provision (benefit) for income taxes and unrealized (gains) losses on derivative contracts. We have included a presentation of adjusted EBITDA because we recognize that certain investors consider adjusted EBITDA a useful means of measuring our ability to meet our debt service obligations and evaluating our financial performance. Adjusted EBITDA has limitations and should not be considered in isolation or as a substitute for net income, operating income, cash flow from operations or other consolidated income or cash flow data prepared in accordance with GAAP. Because not all companies use identical calculations, this presentation of adjusted EBITDA may not be comparable to a similarly titled measure of other companies. The following table provides a reconciliation of net income (loss) to adjusted EBITDA for the periods indicated.

Third Quarter Ended Third Quarter Ended Nine Months Ended Nine Months Ended

June 30, 2020 June 30, 2019 June 30, 2020 June 30, 2019

Net Income (Loss) $ (3,555,215) $ 4,604,236 $ (22,117,915) $ 15,408,842

Plus:

Unrealized (gains) losses on derivatives 2,537,404 (1,894,303) 814,633 (6,125,525)

Income Tax Expense (Benefit) (877,940) 1,315,000 (7,610,940) 4,756,000

Interest Expense 241,191 526,677 958,429 1,551,831

DD&A 2,464,568 4,383,043 8,793,787 11,820,705

Impairment 358,826 - 29,904,528 -

Adjusted EBITDA $ 1,168,834 $ 8,934,653 $ 10,742,522 $ 27,411,853

Adjusted Pre-Tax Net Income (Loss) Reconciliation

Adjusted pre-tax net income (loss) is defined as net income (loss) plus provision for impairment, provision (benefit) for income taxes and unrealized (gains) losses on derivative contracts. We have included a presentation of adjusted pre-tax net income (loss) because we recognize that certain investors consider adjusted pre-tax net income (loss) a useful means of evaluating our financial performance. Adjusted pre-tax net income (loss) has limitations and should not be considered in isolation or as a substitute for net income, operating income, cash flow from operations or other consolidated income or cash flow data prepared in accordance with GAAP. Because not all companies use identical calculations, this presentation of adjusted pre-tax net income (loss) may not be comparable to a similarly titled measure of other companies. The following table provides a reconciliation of net income (loss) to adjusted pre-tax net income (loss) for the periods indicated.

Third Quarter Ended Third Quarter Ended Nine Months Ended Nine Months Ended

June 30, 2020 June 30, 2019 June 30, 2020 June 30, 2019

Net Income (Loss) $ (3,555,215) $ 4,604,236 $ (22,117,915) $ 15,408,842

Plus:

Impairment 358,826 - 29,904,528 -

Unrealized (gains) losses on derivatives 2,537,404 (1,894,303) 814,633 (6,125,525)

Income Tax Expense (Benefit) (877,940) 1,315,000 (7,610,940) 4,756,000

Adjusted Pre-Tax Net Income (Loss) $ (1,536,925) $ 4,024,933 $ 990,306 $ 14,039,317

Panhandle Oil and Gas Inc. (NYSE: PHX)Oklahoma City-based, Panhandle Oil and Gas Inc. is an oil and natural gas mineral company with a strategy to proactively pursue the acquisition of additional minerals in our core areas of focus. Panhandle owns approximately 258,000 net mineral acres principally located in Oklahoma, North Dakota, Texas, New Mexico and Arkansas. Approximately 71% of this mineral count is unleased and undeveloped. Additional information on the Company can be found at www.panhandleoilandgas.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Words such as "anticipates," "plans," "estimates," "believes," "expects," "intends," "will," "should," "may" and similar expressions may be used to identify forward-looking statements. Forward-looking statements are not statements of historical fact and reflect Panhandle's current views about future events. Forward-looking statements may include, but are not limited to, statements relating to: our future financial and operating results; our ability to execute our business strategies; estimations and the respective values of oil, NGL and natural gas reserves; the level of production on our properties and the future expenses associated therewith; projections and volatility of future realized oil and natural gas prices; planned capital expenditures associated with our mineral, leasehold and non-operated working interests; statements concerning anticipated cash flow and liquidity; and our strategy and other plans and objectives for future operations. Although Panhandle believes the expectations reflected in these and other forward-looking statements are reasonable, we can give no assurance they will prove to be correct. Such forward-looking statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company. These forward-looking statements involve certain risks and uncertainties that could cause the results to differ materially from those expected by the Company's management. Information concerning these risks and other factors can be found in the Company's filings with the Securities and Exchange Commission, including its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, available on the Company's website or the SEC's website at www.sec.gov.

Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in forward-looking statements. The forward-looking statements in this press release are made as of the date hereof, and the Company does not undertake any obligation to update the forward-looking statements as a result of new information, future events or otherwise.

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SOURCE PANHANDLE OIL AND GAS INC.