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Last Update: 18-Mar-13 08:53 ET
Magnum Hunter shares fall 4% following delay of 10K filing and guidance
Magnum Hunter (MHR $3.90 -0.17) disclosed due to the reasons previously disclosed in its SEC filings (lack of sufficient qualified personnel to design and manage an effective control environment, (ii) period-end financial reporting processes and (iii) share-based compensation), the filing of the Company's Annual Report on Form 10-K for the year ended Dec 31, 2012 will be delayed beyond the extended due date of March 18, 2013. The Company's rapid growth, particularly during the last 24 months, has resulted in complex and challenging accounting issues and operational integration matters that have required a significant amount of time and human resources in order to complete the fiscal 2012 audit. Magnum Hunter expects to obtain the necessary consents from its lenders under the Company's senior credit facility to allow the Company to provide its 2012 audited consolidated financial statements at a later date, and also expects to obtain similar consents from the lenders under Eureka Hunter Pipeline, LLC's credit facilities. In addition, Magnum Hunter intends to take the appropriate action to prevent or cure any default under the Company's senior notes indenture resulting from its failure to timely file this audited financial information. Guidance: Projected revenue for Q4 and FY12 was ~$86 mln vs. the $83 mln consensus and approximately $274 million (+141%), respectively. Estimated oil and gas production was 1,300 Mboe and 4,800 Mboe for the three months and year ended December 31, 2012, respectively. Estimated oil and gas average daily production was approximately 14,900 Boe and 13,200 Boe for the three months and year ended December 31, 2012, respectively. The Company's oil and gas production rate at December 31, 2012 was in excess of 18,500 Boepd. The Company had liquidity of ~$100 mln as of March 15, 2013. The Company believes it has sufficient liquidity and projected cash flow from operations to fund its projected fiscal 2013 upstream capital budget of $300 mln, absent any contemplated asset sales. The co is continuing to aggressively pursue planned monetizations of certain of its properties, including its Eagle Ford Shale properties, to further enhance its liquidity, and the co expects to announce the results of such activities in the near future. The Company anticipates non-cash charges for impairment to its unproved properties and proved properties of approximately $49 million and approximately $16 million, respectively, in the three months ended December 31, 2012. Co will host a call at 11:30 this morning.
