GeoResources, Inc. Reports Fourth Quarter and 2010 Annual Financial Results

HOUSTON--(BUSINESS WIRE)--GeoResources, Inc., (NASDAQ:GEOI), today announced its financial and operating results for the twelve and three month periods ended December 31, 2010. The following tables summarize the results of operations compared to similar periods in 2009.

(1) See additional detail below.

The following tables reconcile reported net income to EBITDAX for the periods indicated (in thousands):

(1) As used herein, EBITDAX is calculated as earnings before interest, income taxes, depreciation, depletion and amortization, and exploration expense and further excludes non-cash compensation, impairments, hedge ineffectiveness and income or loss on derivative contracts. EBITDAX should not be considered as an alternative to net income (as an indicator of operating performance) or as an alternative to cash flow (as a measure of liquidity or ability to service debt obligations) and is not in accordance with, nor superior to, generally accepted accounting principles, but provides additional information for evaluation of our operating performance.

Comments

Frank A. Lodzinski, CEO and President, commented “We are pleased to report our results of operations for 2010. We closed out 2010 after achieving several financial milestones, including record revenues, EBITDAX, and net income. These records were achieved both on an absolute dollar basis and also on a per share basis. Importantly, on the production side we reported a 25% increase in oil production and our gas production only declined slightly as a result of our conscious decision to suspend our natural gas drilling early in 2010. As we enter 2011, we are working diligently to address the challenges in our industry and continue our profitable growth. Our capital position is excellent, having completed our public offering of 5,175,000 shares of common stock in January, resulting in net proceeds of $122.9 million and allowing us to pay down all $87 million of our debt, leaving us with $45 million of cash to fund operations and drilling and development expenditures.”

About GeoResources, Inc.

GeoResources, Inc. is an independent oil and gas company engaged in the development and acquisition of oil and gas reserves through an active and diversified program that includes the acquisition, drilling and development of undeveloped leases, purchases of reserves, exploration and re-engineering activities, currently focused in the Southwest, Gulf Coast, and the Williston Basin. For more information, visit our website at www.georesourcesinc.com.

Forward Looking Statements - Information included herein contains forward-looking statements that involve significant risks and uncertainties, including our need to replace production and acquire or develop additional oil and gas reserves, intense competition in the oil and gas industry, our dependence on our management, volatile oil and gas prices and costs, uncertain effects of hedging activities and uncertainties of our oil and gas estimates of proved reserves and reserve potential, all of which may be substantial. In addition, past performance is no guarantee of future performance and results. All statements or estimates made by the Company, other than statements of historical fact, related to matters that may or will occur in the future are forward-looking statements. Readers are encouraged to read our December 31, 2009 Annual Report on Form 10-K and Form 10-K/A and our other documents subsequently filed with the SEC regarding information about GeoResources for meaningful cautionary language in respect of the forward-looking statements herein. Interested persons are able to obtain copies of filings containing information about GeoResources, without charge, at the SEC’s internet site (http://www.sec.gov). There is no duty to update the statements herein.