Evolution Petroleum Reports Results for Second Quarter of Fiscal 2013

Tue Feb 5, 2013 11:06pm EST

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Compared to our First Fiscal Quarter:
HOUSTON,  Feb. 5, 2013  /PRNewswire/ -- Evolution Petroleum Corporation (NYSE
MKT: EPM) today reported operating highlights for the quarter ended  December
31, 2012, its second quarter of fiscal 2013 ("Q2-13").  

Highlights include:

* Earned  $1.8 million, or  $0.06  per diluted share, an 81% sequential increase
 
* Increased sales volumes 20% sequentially to 696 net barrels of oil equivalent
("BOE") per day  
* Delhi  volumes increased 36% over prior quarter to 6,872 gross barrels of oil
("BO") per day (509 net)  
* Continued de-watering and de-pressuring our first two Mississippian Lime
wells, a necessary prerequisite to achieve expected oil and gas production rates
 
* Advanced the application of our GARP technology

Robert Herlin, CEO, said: "We are pleased to report that  Delhi  production has
not only sharply rebounded from the constraints of summer heat, it is also
responding to prior year capital expenditures while continuing to outperform our
original expectations. Both of our initial Mississippian Lime producers are
taking longer to de-water and de-pressure than we originally expected, but both
wells have begun to produce small, but increasing amounts of oil and
liquids-rich gas. Since other operators in the area have reported similar
dewatering results, we remain cautiously optimistic as to our projected reserves
and expectations of increased drilling activity in the play later this fiscal
year."  

Mr. Herlin added: "Our strategy to increase underlying net asset value in a
focused manner, without diluting shareholders, is clearly being reflected in our
record earnings growth, excluding asset sales.  Further growth will be propelled
by a major step change, when our 24% working interest at  Delhi  reverts back to
us later this year and begins contributing substantial incremental net cash flow
and earnings."        

Quarterly Financial Results

Quarterly earnings to common shareholders increased 81% to  $1.8 million, or 
$0.06  per diluted share, compared to  $1.0 million, or  $0.03  per diluted
share in the prior quarter. Net income to common shareholders increased 42% over
the year-ago quarter.

Revenues increased 32% to  $5.6 million  compared to  $4.3 million  in the prior
quarter, and increased 22% compared to the year-ago quarter. The increase over
the prior quarter was primarily due to a higher rate of oil production. The
increase over the year-ago quarter was due to higher oil production, offset by
lower oil and NGL prices, and lower natural gas and NGL volumes.

Lease operating expense increased 33% to  $0.4 million  compared to the prior
quarter due primarily to the addition of wells in our Mississippian Lime project
and work-overs in the Giddings Field. Compared to the year ago quarter, lease
operating expense was flat. On a BOE basis, lease operating expense during Q2-13
was  $6.55  per BOE compared to  $5.92  and  $7.89  in the sequential and
year-ago quarters. General and administrative expense increased 6% over the
prior quarter to  $1.8 million, and 22% over the year-ago quarter.  The
increases were primarily due to higher bonus and board fee accruals, noncash
stock expense, litigation and other legal expense and transaction costs related
to divestments. Results for all periods included significant non-cash stock
compensation expense, amounting to 22% of total general and administrative
expense in the current quarter and 24% in the year-ago quarter.  

Delhi Field,  Louisiana

Gross sales volumes at  Delhi  increased dramatically during the current quarter
and averaged 6,872 BO per day (509 net BO per day). Q2-13 volumes were 36%
higher than the prior quarter and 39% higher than the year-ago quarter. The
increase was due to resumption of normal production with the onset of cooler
weather and to response from the capital expenditures in the project during the
prior year. The operator is expected to add additional cooling capacity to the
plant before summer temperatures return in 2013. Our net sales volumes from 
Delhi  during Q2-13 were solely from our 7.4% royalty interest that bears no
operating expense or capital expenditure. We continued to realize a significant
premium in oil price that averaged more than  $104  per barrel during the
quarter, compared to the  $90  per barrel we received in our other fields.

Current field production is outperforming the production rate projected in our 
June 30, 2012  independent reserves report, and we continue to expect that our
24% reversionary working interest will revert to Evolution during the second
half of calendar 2013.  At reversion, our net revenue interest will more than
triple from 7.4% to 26.5%, while our cost bearing working interest will increase
from zero to 23.9%.  Based on performance, the operator has refocused calendar
2013 capital expenditures to expand the CO2  flood within the previously
developed western half of the field in order to better capture the full
potential from the reservoirs in that area, before completing the expansion of
the CO2  flood in the balance of the eastern half of the field in 2014 and 2015.

Mississippian Lime Project,  Oklahoma

Our first two Mississippian Lime wells were completed and hydraulically
fractured during Q2-13. The Sneath #1H was placed on production at the end of
October and the Hendrickson #1H late in November of 2013. Both wells produced
saltwater at rates less than 3,000 barrels per day to begin reducing reservoir
pressure and salt water content, a precursor to achieving projected oil and
liquids-rich natural gas production. The high volumes of salt water are
economically disposed into our joint venture's wholly owned disposal well. 
Recently, the operator replaced the originally installed down hole pumps with
higher capacity pumps to increase salt water production closer to the 10,000
barrel per day rate that other operators in the area have identified as
sometimes required.  Reservoir pressure in each well has gradually declined and
oil and gas production, while currently low, is increasing, suggesting that the
wells are steadily depleting reservoir water and pressure, thus liberating oil
and natural gas. Our independent reservoir engineer has assigned 112 additional
gross drilling locations to our joint venture leasehold, and we plan to resume
development pending the results of our first two wells in the play with the
expectation of ramping-up our drilling program during the fourth fiscal quarter.

GARP Technology Commercialization

We installed our GARP artificial lift technology in the Select Lands #1 joint
venture well in the Giddings Field during Q2-13 that, as previously announced,
increased production from about 1 BOE per day to approximately 20 BOE per day.
We are continuing the commercialization effort for GARP and have reached
tentative agreement to add another joint venture well in Giddings.  Discussions
for additional GARP applications in  Giddings  continue with our joint venture
partners, and with various other companies active in other  Texas  fields.  We
also recently began a program to acquire abandoned wells, solely for our own
account, offering good potential for renewed production utilizing our GARP
technology.  

Other Fields

One small sale and one larger sale of noncore assets in the Giddings Field were
completed during Q2-13, including most of our non-GARP production and
undeveloped reserves in the Giddings Field. Proceeds included approximately 
$3.1 million  before transaction costs, plus contingent payments based on future
drilling activity. The larger sale for  $2.8 million  was completed  December
24th, while the smaller sale was completed in early November.  Accordingly,
Q2-13 results included most of the production, revenue and operating expense for
the divested assets. Had the divestments been completed at the beginning of the
quarter, net production in the Giddings Field would have been reduced by 75%, or
125 net BOE per day, to 42 net BOE per day.  Similarly, approximately  $400,000 
of revenue,  $145,000  of direct well expense (using the company's average 
$5.24/BOE depletion rate) and  $255,000  of pre-tax well income ($22/BOE) would
have been absent in the current quarter's results.  The divested properties were
high in natural gas and NGL content, averaging 80% of production volumes in the
current quarter, and included approximately 350 MBOE of proved developed
reserves and 1.8 MMBOE of proved undeveloped reserves as of  June 30, 2012. Sale
proceeds and staff are already being redeployed to our Mississippian Lime and
GARP projects.  

The remaining noncore assets in the Giddings Field are being offered for sale,
excluding certain wells in which our GARP technology has been installed, and
excluding our minor royalty and reversionary interests in the Woodbine play in
northern  Grimes County.

Our first two  Mirando Sand  oil wells in the Lopez Field in  South Texas 
continue to produce at better than expected rates and a third lease oil well has
begun to produce oil.  We completed the swap of our oil well and water injector
well on our third lease and began production during Q2-13.  Although the
performance to date has confirmed the project potential and we have numerous
additional drilling locations, the long lead time to achieve material economic
results in an expansion of the project outside of the Lopez Field has led to a
noncore designation.

Capital Expenditures and Liquidity

Capital expenditures during the quarter were  $4 million, invested primarily in
our Mississippian Lime wells. We now expect that Fiscal 2013 capital
expenditures will be reduced by about  $3 million  due to delayed drilling in
the Mississippian Lime project that will carry over into the next year.   

At  December 31, 2012, we had cash and cash equivalents of  $18.0 million 
compared to  $13.1 million  as of the end of the first quarter and  $14.4
million  as of  June 30, 2012.  Our current working capital of  $18.0 million 
is more than sufficient to meet our projected capital expenditures during the
balance of Fiscal 2013 and any likely expansions. We continue to be debt free.

Conference Call

Evolution Petroleum will host a conference call on  Wednesday, February 6th  at 
11:00 a.m. Eastern Time  (10:00 a.m.Central) to discuss results of the quarter.
To access the call, please dial 1-800-860-2442, 1-412-858-4600 (International)
or 1-866-605-3852 (Canada).  The conference call will also be broadcast live via
the Internet and can be accessed through Evolution's corporate website at 
www.evolutionpetroleum.com.  

About Evolution Petroleum

Evolution Petroleum Corporation develops incremental petroleum reserves and
shareholder value by applying conventional and specialized technology to known
oil and gas resources, onshore in  the United States.   Principal assets as of 
June 30, 2012  include 13.4 MMBOE of proved reserves and 12.7 MMBOE of probable
reserves with PV-10* of  $445 million  and  $174 million, respectively, and no
debt, before the effect of the Giddings Field divestments.  Producing assets
include a CO2-EOR project with growing production in  Louisiana's Delhi Field,
and noncore producing properties and drilling locations in the Giddings Field of
 Central Texas  and Lopez Field in South Texas.  Other assets include a 45%
interest in a joint venture in the Mississippian Lime play in  Oklahoma  and a
patented artificial lift technology designed to extend the life of horizontal
wells with oil or associated water production.  Additional information,
including the Company's annual report on Form 10-K and its quarterly reports on
Form 10-Q, is available on its website at (www.evolutionpetroleum.com).

Cautionary Statement  

All statements contained in this press release regarding potential results and
future plans and objectives of the Company are forward-looking statements that
involve various risks and uncertainties. There can be no assurance that such
statements will prove to be accurate and actual results and future events could
differ materially from those anticipated in such statements. The Company
undertakes no obligation to update or review any forward-looking statement,
whether as a result of new information, future events, or otherwise. Important
factors that could cause actual results to differ materially from our
expectations include, but are not limited to, those factors that are disclosed
under the heading "Risk Factors" and elsewhere in our documents filed from time
to time with the United States Securities and Exchange Commission and other
regulatory authorities. Statements regarding our ability to complete
transactions, successfully apply technology applications in the re-development
of oil and gas fields, realize future production volumes, realize success in our
drilling and development activity and forecasts of legal claims, prices, future
revenues and income and cash flows and other statements that are not historical
facts contain predictions, estimates and other forward-looking statements.
Although the Company believes that its expectations are based on reasonable
assumptions, it can give no assurance that its goals will be achieved and these
statements will prove to be accurate. Important factors could cause actual
results to differ materially from those included in the forward-looking
statements.

* PV-10 of proved reserves is a pre-tax non-GAAP measure reconciled to the
after-tax Standardized Measure of Future Net Cash Flows below.  We believe that
the presentation of the non-GAAP financial measure of PV-10 provides useful and
relevant information to investors because of its wide use by analysts and
investors in evaluating the relative monetary significance of oil and natural
gas properties, and as a basis for comparison of the relative size and value of
our reserves to other companies' reserves.  We also use this pre-tax measure
when assessing the potential return on investment related to oil and natural gas
properties and in evaluating acquisition opportunities.  Because there are many
unique factors that can impact an individual company when estimating the amount
of future income taxes to be paid, we believe the use of a pre-tax measure is
valuable for evaluating our Company.  PV-10 is not a measure of financial or
operating performance under GAAP, nor is it intended to represent the current
market value of our estimated oil and natural gas reserves. PV-10 should not be
considered in isolation or as a substitute for the Standardized Measure as
defined under GAAP, and reconciled below.  Probable reserves are not recognized
by GAAP, and therefore the PV-10 of probable reserves cannot be reconciled to a
GAAP measure.

The following table provides a reconciliation of PV-10 of each of our proved
properties to the Standardized Measure.

                                                                For the Years Ended June 30                                   
                                                                2012                            2011                        
                                                                                                                          
 Estimated future net revenues                                  $       858,510,526            $       741,212,773        
 10% annual discount for estimated timing of future cash flows          (412,995,901)                  (365,874,315)      
 Estimated future net revenues discounted at 10% (PV-10)                445,514,625                    375,338,458        
 Estimated future income tax expenses discounted at 10%                 (161,917,132)                  (146,890,504)      
 Standardized Measure                                           $       283,597,493            $       228,447,954        


- Financial Tables to Follow -

 Evolution Petroleum Corporation and Subsidiaries                                                                                                         
 
Consolidated Condensed Statements of Operations                                                                                                         
 
(Unaudited)                                                                                                                                             
                                                                                                                                                    
                                                           Three Months Ended                            Six Months Ended                           
                                                           December 31,                                  December 31,                               
                                                           2012                      2011             2012                      2011          
 Revenues                                                                                                                                     
 Crude oil                                              $  5,379,399          $      4,231,201     $  9,384,821          $      7,679,796     
 Natural gas liquids                                       86,556                    182,971          206,167                   371,426       
 Natural gas                                               182,103                   232,530          348,616                   480,336       
 Total revenues                                            5,648,058                 4,646,702        9,939,604                 8,531,558     
                                                                                                                                              
 Operating Costs                                                                                                                              
 Lease operating expenses                                  419,328                   412,470          735,497                   615,387       
 Production taxes                                          20,863                    18,725           42,236                    32,760        
 Depreciation, depletion and amortization                  350,119                   280,795          647,036                   517,686       
 Accretion of discount on asset retirement obligations     17,751                    19,616           38,858                    36,588        
 General and administrative expenses *                     1,815,276                 1,488,258        3,520,700                 2,893,433     
 Total operating costs                                     2,623,337                 2,219,864        4,984,327                 4,095,854     
                                                                                                                                              
 Income from operations                                    3,024,721                 2,426,838        4,955,277                 4,435,704     
                                                                                                                                              
 Other                                                                                                                                        
 Interest income                                           5,614                     6,712            11,230                    13,958        
 Interest (expense)                                        (16,564)                  ---              (32,992)                  ---           
                                                           (10,950)                  6,712            (21,762)                  13,958        
                                                                                                                                              
 Net income before income taxes                            3,013,771                 2,433,550        4,933,515                 4,449,662     
                                                                                                                                              
 Income tax provision                                      1,054,499                 1,008,195        1,814,717                 1,880,789     
                                                                                                                                              
 Net Income                                             $  1,959,272          $      1,425,355     $  3,118,798          $      2,568,873     
                                                                                                                                              
 Dividends on Preferred Stock                              168,576                   165,405          337,151                   293,240       
                                                                                                                                              
 Net income available to common shareholders            $  1,790,696          $      1,259,950     $  2,781,647          $      2,275,633     
                                                                                                                                              
 Basic                                                  $  0.06               $      0.05          $  0.10               $      0.08          
                                                                                                                                              
 Diluted                                                $  0.06               $      0.04          $  0.09               $      0.07          
                                                                                                                                              
 Weighted average number of common shares                                                                                                     
                                                                                                                                              
 Basic                                                     28,071,317                27,792,768       28,032,223                27,731,062    
                                                                                                                                              
 Diluted                                                   31,856,417                31,515,271       31,836,983                31,394,528    


                                                                                                                                                                                                                                                                                                                      
 * General and administrative expenses for the three months ended December 31, 2012 and 2011 included non-cash stock-based compensation expense of $393,579 and $354,871, respectively.  For the corresponding six month period's non-cash stock-based compensation expense was $747,369 and $771,566, respectively.  


 Evolution Petroleum Corporation and Subsidiaries                                                                                                                                                                                                                                                                                       
 
Consolidated Condensed Balance Sheets                                                                                                                                                                                                                                                                                                 
 
(Unaudited)                                                                                                                                                                                                                                                                                                                           
                                                                                                                                                                                                                                                                                                                                     
                                                                                                                                                                                                                                                                        December 31,                       June 30,                  
                                                                                                                                                                                                                                                                        2012                               2012                      
 Assets                                                                                                                                                                                                                                                                                                                            
 Current assets                                                                                                                                                                                                                                                                                                                    
 Cash and cash equivalents                                                                                                                                                                                                                                              $          18,029,838             $          14,428,548    
 Certificates of deposit                                                                                                                                                                                                                                                           250,000                           250,000       
 Receivables                                                                                                                                                                                                                                                                                                                       
 Oil and natural gas sales                                                                                                                                                                                                                                                         2,141,280                         1,343,347     
 Joint interest partner                                                                                                                                                                                                                                                            24,871                            96,151        
 Income taxes                                                                                                                                                                                                                                                                      92,885                            92,885        
 Other                                                                                                                                                                                                                                                                             306                               190           
 Deferred tax asset                                                                                                                                                                                                                                                                162,746                           325,235       
 Prepaid expenses and other current assets                                                                                                                                                                                                                                         184,842                           233,433       
 Total current assets                                                                                                                                                                                                                                                              20,886,768                        16,769,789    
                                                                                                                                                                                                                                                                                                                                   
 Property and equipment, net of depreciation, depletion, and amortization                                                                                                                                                                                                                                                          
 Oil and natural gas properties - full-cost method of accounting, of which $9,031,522 and $6,042,094 at December 31, 2012 and June 30, 2012, respectively, were excluded from amortization.                                                                                        40,276,684                        40,476,172    
 Other property and equipment                                                                                                                                                                                                                                                      68,031                            92,271        
 Total property and equipment                                                                                                                                                                                                                                                      40,344,715                        40,568,443    
                                                                                                                                                                                                                                                                                                                                   
 Advances to joint interest operating partner                                                                                                                                                                                                                                      --                                1,366,921     
 Other assets                                                                                                                                                                                                                                                                      269,758                           250,333       
                                                                                                                                                                                                                                                                                                                                   
 Total assets                                                                                                                                                                                                                                                           $          61,501,241             $          58,955,486    
                                                                                                                                                                                                                                                                                                                                   
 Liabilities and Stockholders' Equity                                                                                                                                                                                                                                                                                              
 Current liabilities                                                                                                                                                                                                                                                                                                               
 Accounts payable                                                                                                                                                                                                                                                       $          415,489                $          407,570       
 Due joint interest partner                                                                                                                                                                                                                                                        1,383,991                         3,217,975     
 Accrued compensation                                                                                                                                                                                                                                                              609,350                           1,005,624     
 Royalties payable                                                                                                                                                                                                                                                                 219,137                           294,013       
 Income taxes payable                                                                                                                                                                                                                                                              137,924                           91,967        
 Other current liabilities                                                                                                                                                                                                                                                         170,873                           71,768        
 Total current liabilities                                                                                                                                                                                                                                                         2,936,764                         5,088,917     
                                                                                                                                                                                                                                                                                                                                   
 Long term liabilities                                                                                                                                                                                                                                                                                                             
 Deferred income taxes                                                                                                                                                                                                                                                             7,541,364                         6,205,093     
 Asset retirement obligations                                                                                                                                                                                                                                                      826,840                           968,677       
 Deferred rent                                                                                                                                                                                                                                                                     61,437                            70,011        
                                                                                                                                                                                                                                                                                                                                   
 Total liabilities                                                                                                                                                                                                                                                                 11,366,405                        12,332,698    
                                                                                                                                                                                                                                                                                                                                   
 Commitments and contingencies (Note 11)                                                                                                                                                                                                                                                                                           
                                                                                                                                                                                                                                                                                                                                   
 Stockholders' equity                                                                                                                                                                                                                                                                                                              
 Preferred stock, par value $0.001; 5,000,000 shares authorized:8.5% Series A Cumulative Preferred Stock, 1,000,000 shares authorized, 317,319 shares issued and outstanding at December 31, 2012, and June 30, 2012 with a liquidation preference of $25.00 per share             317                               317           
 Common stock; par value $0.001; 100,000,000 shares authorized: issued 28,897,133 shares at December 31, 2012, and 28,670,424 at June 30, 2012; outstanding 28,106,796 shares and 27,882,224 shares as of December 31, 2012 and June 30, 2012, respectively                        28,897                            28,670        
 Additional paid-in capital                                                                                                                                                                                                                                                        30,164,056                        29,416,914    
 Retained earnings                                                                                                                                                                                                                                                                 20,840,556                        18,058,909    
                                                                                                                                                                                                                                                                                   51,033,826                        47,504,810    
 Treasury stock, at cost, 790,337 shares and 788,200 shares as of December 31, 2012  and June 30, 2012, respectively                                                                                                                                                               (898,990)                         (882,022)     
                                                                                                                                                                                                                                                                                                                                   
 Total stockholders' equity                                                                                                                                                                                                                                                        50,134,836                        46,622,788    
                                                                                                                                                                                                                                                                                                                                   
 Total liabilities and stockholders' equity                                                                                                                                                                                                                             $          61,501,241             $          58,955,486    


 Evolution Petroleum Corporation and Subsidiaries                                                                                                         
 
Consolidated Condensed Statements of Cash Flows                                                                                                         
 
(Unaudited)                                                                                                                                             
                                                                                                                                                        
                                                                                             Six Months Ended                                           
                                                                                             
December 31,                                              
                                                                                             2012                            2011                     
 Cash flows from operating activities                                                                                                               
 Net Income                                                                                  $        3,118,798             $        2,568,873      
 Adjustments to reconcile net income to net cash provided by operating activities:                                                                  
 Depreciation, depletion and amortization                                                             667,461                        517,686        
 Stock-based compensation                                                                             747,369                        771,566        
 Accretion of discount on asset retirement obligations                                                38,858                         36,588         
 Settlements of asset retirement obligations                                                          (47,026)                       (30,969)       
 Deferred income taxes                                                                                1,498,760                      1,258,106      
 Deferred rent                                                                                        (8,574)                        (6,829)        
 Changes in operating assets and liabilities:                                                                                                       
 Receivables from oil and natural gas sales                                                           (797,933)                      (402,023)      
 Receivables from income taxes and other                                                              (116)                          20,889         
 Due to/from joint interest partner                                                                   40,050                         6,854          
 Prepaid expenses and other current assets                                                            48,591                         (102,360)      
 Accounts payable and accrued expenses                                                                (390,979)                      (307,079)      
 Royalties payable                                                                                    (74,876)                       (122,225)      
 Income taxes payable                                                                                 115,801                        93,279         
 Net cash provided by operating activities                                                            4,956,184                      4,302,356      
                                                                                                                                                    
 Cash flows from investing activities                                                                                                               
 Proceeds from asset sales                                                                            3,054,976                      -              
 Acquisitions of oil and natural gas properties                                                       (943,196)                      (174,604)      
 Development of oil and natural gas properties                                                        (3,070,234)                    (1,329,930)    
 Capital expenditures for other property and equipment                                                --                             (12,778        
 Advances to joint venture operating partner                                                          --                             -              
 Other assets                                                                                         (26,110                        (23,657)       
 Net cash used in investing activities                                                                (984,564)                      (1,540,969)    
                                                                                                                                                    
 Cash flows from financing activities                                                                                                               
 Proceeds from issuances of preferred stock, net                                                      -                              6,930,535      
 Preferred stock dividends paid                                                                       (337,151)                      (293,240)      
 Purchases of treasury stock                                                                          (16,968)                       -              
 Deferred loan costs                                                                                  (16,211)                       -              
 Net cash provided by (used in) financing activities                                                  (370,330)                      6,637,295      
                                                                                                                                                    
 Net increase in cash and cash equivalents                                                            3,601,290                      9,398,682      
                                                                                                                                                    
 Cash and cash equivalents, beginning of period                                                       14,428,548                     4,247,438      
                                                                                                                                                    
 Cash and cash equivalents, end of period                                                    $        18,029,838            $        13,646,120     


Our supplemental disclosures of cash flow information for the three months ended
December 31, 2012 and 2011 are as follows:

                                                                                                                                               Six Months Ended                            
                                                                                                                                               December 31,                                
                                                                                                                                               2012                    2011              
 Income taxes paid                                                                                                                             $     200,156          $     513,581    
                                                                                                                                                                                       
 Non-cash transactions:                                                                                                                                                                
 Change in accounts payable used to acquire oil and natural gas leasehold interests and develop oil and natural gas properties                       31,885                 449,146    
 Change in due to joint interest partner used to acquire oil and natural gas leasehold interests and develop oil and natural gas properties          (435,833)              -          
 Change in accounts payable related to joint venture activities                                                                                      -                      9,576      
 Oil and natural gas properties incurred through recognition of asset retirement obligations                                                         8,558                  47,200     


 Results of Operations - Quarter                                                                                                                 
                                                                                                                                         
                                                            Three Months Ended                                                           
                                                            December 31,                                                      %          
                                                            2012                    2011                Variance             Change     
                                                                                                                                     
 Sales Volumes, net to the Company:                                                                                                  
                                                                                                                                     
 Crude oil (Bbl)                                                  52,270                 37,514              14,756       39.3    %  
                                                                                                                                     
 NGLs (Bbl)                                                       2,378                  3,145               (767)        (24.4)  %  
                                                                                                                                     
 Natural gas (Mcf)                                                56,210                 69,880              (13,670)     (19.6)  %  
 Crude oil, NGLs and natural gas (BOE)                            64,016                 52,306              11,710       22.4    %  
                                                                                                                                     
 Revenue data:                                                                                                                       
                                                                                                                                     
 Crude oil                                                  $     5,379,399        $     4,231,201    $      1,148,198    27.1    %  
                                                                                                                                     
 NGLs                                                             86,556                 182,971             (96,415)     (52.7)  %  
                                                                                                                                     
 Natural gas                                                      182,103                232,530             (50,427)     (21.7)  %  
 Total revenues                                             $     5,648,058        $     4,646,702    $      1,001,356    21.5    %  
                                                                                                                                     
 Average price:                                                                                                                      
 Crude oil (per Bbl)                                        $     102.92           $     112.79       $      (9.87)       (8.8)   %  
 NGLs (per Bbl)                                                   36.40                  58.18               (21.78)      (37.4)  %  
 Natural gas (per Mcf)                                            3.24                   3.33                (0.09)       (2.7)   %  
 Crude oil, NGLs and natural gas (per BOE)                  $     88.23            $     88.84        $      (0.61)       (0.7)   %  
                                                                                                                                     
 Expenses (per BOE)                                                                                                                  
 Lease operating expenses                                   $     6.55             $     7.89         $      (1.34)       (17.0)  %  
 Production taxes                                           $     0.33             $     0.35         $      (0.02)       (5.7)   %  
 Depletion expense on oil and natural gas properties (a)    $     5.24             $     5.20         $      0.04         0.8     %  


                                                                                                                                                                                       
 (a)  Excludes depreciation of office equipment, furniture and fixtures, and other assets of $14,462 and $8,723, for the three months ended December 31, 2012 and 2011, respectively.  


 Results of Operations - YTD                                                                                                                     
                                                                                                                                         
                                                            Six Months Ended                                                             
                                                            December 31,                                                      %          
                                                            2012                    2011                Variance             Change     
                                                                                                                                     
 Sales Volumes, net to the Company:                                                                                                  
                                                                                                                                     
 Crude oil (Bbl)                                                  91,352                 70,674              20,678       29.3    %  
                                                                                                                                     
 NGLs (Bbl)                                                       5,759                  6,666               (907)        (13.6)  %  
                                                                                                                                     
 Natural gas (Mcf)                                                122,079                130,597             (8,518)      (6.5)   %  
 Crude oil, NGLs and natural gas (BOE)                            117,457                99,106              18,351       18.5    %  
                                                                                                                                     
 Revenue data:                                                                                                                       
                                                                                                                                     
 Crude oil                                                  $     9,384,821        $     7,679,796    $      1,705,025    22.2    %  
                                                                                                                                     
 NGLs                                                             206,167                371,426             (165,259)    (44.5)  %  
                                                                                                                                     
 Natural gas                                                      348,616                480,336             (131,720)    (27.4)  %  
 Total revenues                                             $     9,939,604        $     8,531,558    $      1,408,046    16.5    %  
                                                                                                                                     
 Average price:                                                                                                                      
 Crude oil (per Bbl)                                        $     102.73           $     108.67       $      (5.93)       (5.5)   %  
 NGLs (per Bbl)                                                   35.80                  55.72               (19.92)      (35.8)  %  
 Natural gas (per Mcf)                                            2.86                   3.68                (0.82)       (22.4)  %  
 Crude oil, NGLs and natural gas (per BOE)                  $     84.62            $     86.09        $      (1.47)       (1.7)   %  
                                                                                                                                     
 Expenses (per BOE)                                                                                                                  
 Lease operating expenses                                   $     6.26             $     6.21         $      0.05         0.8     %  
 Production taxes                                           $     0.36             $     0.33         $      0.03         9.1     %  
 Depletion expense on oil and natural gas properties (a)    $     5.28             $     5.06         $      0.22         4.4     %  


                                                                                                                                                                                     
 (a)  Excludes depreciation of office equipment, furniture and fixtures, and other assets of $26,711 and $16,552 for the six months ended December 31, 2012 and 2011, respectively.  


Company Contact:  
Sterling McDonald, VP & CFO  
(713) 935-0122
smcdonald@evolutionpetroleum.com

 

SOURCE  Evolution Petroleum Corporation

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