Verde Bio Holdings Provides Third Quarter Corporate Update
Verde Bio Holdings, Inc. (OTCQB: VBHI) reported its third quarter results, highlighting a focus on strategic growth in the oil and gas sector. As of January 31, 2023, total reserves were valued at $3.29 million PV-10, while total adjusted revenue dropped to $170,312 from $301,567 a year earlier due to reduced commodity prices and production disruptions. The company posted a net loss of $414,000, affected by one-time expenses and increased operational costs. Verde aims to enhance profitability by divesting non-core assets and is exploring a potential listing on the NYSE American Exchange. The leadership remains optimistic about future acquisitions and market positioning as commodity prices recover.
- Total reserves valued at $3.29 million PV-10 as of 01/31/2023.
- Plans to divest non-core properties to focus on minerals and royalties.
- Healthy pipeline of potential acquisitions.
- Optimism in future growth with strategic planning.
- Total adjusted revenue decreased to $170,312 from $301,567 year-over-year.
- Net loss of $414,000 for the quarter, impacted by increased legal and accounting costs.
- Production disruptions in key areas due to well shut-ins affecting revenue.
FRISCO, TX, March 20, 2023 (GLOBE NEWSWIRE) -- via NewMediaWire -- Verde Bio Holdings, Inc. (OTCQB: VBHI), a growing oil and gas royalty company, today issued its third quarter shareholder update, along with its 10-Q filing with the highlights of the Quarter and what is in store for the future.
The Company remains optimistic on the oil and gas industry’s growth prospects and its opportunistic acquisition opportunities. Verde has built an excellent portfolio to date and is excited about the recent decline in pricing as it looks to capitalize on unique opportunities into its next phase of growth. With acquisition opportunities that current lower prices present and as commodity prices rise again, so does the Company’s revenue on a relative basis with no increased cost to Verde. Management believes the Company is very well positioned for the next phase of its growth and is attractively priced at its current valuation; trading at approximately 1/5th of its asset base.
Commenting on the results, CEO Scott Cox said:
"I'm pleased to report another quarter of consistent execution towards our growth initiatives driven by the strategic expansion of our low-risk, long-life, low-decline asset acquisition model. Looking forward, we are focused on the growth of our portfolio and revenues as well as overall profitability. The recent pullback in commodity prices is providing for attractive acquisitions that fit within our core focus. Additionally, our differentiated and value focused business model continues to deliver exceptional results. As the Company transitions into a more traditional E&P company which holds a significant portfolio of revenue producing royalties, we are very excited about our future. We look forward to this next phase of growth as we streamline operations and push towards profitability and growth. Over the coming months, we also plan to begin divesting of our non-core properties as we become laser focused on solely minerals and royalties.”
Third Quarter Key Highlights
The Company remains focused on the consistent execution of its business model and is pleased to share the below highlights:
- Total Reserves as of 01/31/2023 were
$3.29 million PV-10 value based upon SEC required pricing at$92.01 /bbl oil and$6.19 /MMBTU/ of Natural Gas. - Total Adjusted Revenue of
$170,312 compared to revenues of$301,567 for the three months ended January 31, 2022. Further, as part of the revenues generated from the oil and gas properties, the Company recorded depletion expense of$84,700 during the three months ended January 31, 2023, compared to depletion expense of$227,256 during the period ended January 31, 2023, which represents the proportionate use of the produced units in the properties relative to proven and probable reserves. The overall decrease in depletion expense is reflective of the overall slowed pace of investment in royalty properties due to the high commodity priced environment as of late. - The Quarter was somewhat quiet for the Company with acquisitions but was ripe with activity as it transforms for its next phase of growth. Revenue was down for the quarter due to a decline in commodity prices as well as lower production in areas such as the Haynesville and the Permian due to wells being shut in and taken off-line while new wells are completed and fracked nearby. While it does protect Verde’s wells, it also can cause up to a multi-week disruption in production and thus revenue to the Company. The Company continues to strive toward its goal of profitability. Net loss for the quarter was
$414 k which included a one-time expense of$150 k for unrecoverable deposits made on properties that it did not ultimately close as well as significantly higher legal and accounting costs associated with the reverse split and name change it recently announced.
Portfolio Highlights and Acquisition Activity:
To date, the Company has made over 18 acquisitions of revenue producing properties and recently announced an option to acquire another. The Company currently has revenue producing royalty interests in over 400 wells under operators such as, SWN Energy, EOG, Civitas, Ovintiv, Aethon, Ascent, Chesapeake, Petro Operating and others major, well-funded operators.
Verde continues to have a healthy pipeline of new deal-flow and are evaluating potential acquisitions which complement its portfolio, as well as seeking opportunistic divestments in which it can make large profits, while actively managing the portfolio to maximize revenue based on current commodity environments. Active management also includes seeking divestment of low-performing assets to free up needed cash for reinvestment into better performing and higher growth potential assets.
Corporate Highlights:
On a Corporate note, as we announced previously, the Company recently filed for a reverse split, a name and ticker symbol change to further define the company as an oil and gas Company. We are currently working through the process with FINRA and hope to have it completed soon. Once FINRA approves, we will file a DEF 14-C and then the reverse will become effective after the required waiting period. We also plan to add at least two new Board Members in the near future.
We continue to explore a potential listing on the NYSE American Exchange in 2023. Along with these transformative plans to move to National Exchange, we are working to finalize an agreement with an Investment Bank for advisement on up-listing and a follow-on capital raise for acquisition capital.
Further, as previously mentioned, we continue to work with our IR/PR and Marketing teams to increase market awareness and to attract new long-term growth investors who believe in a company being built on fundamentals.
In summary, we remain focused on execution and are prudently investing in our continued growth, with an emphasis on creating a dynamic and profitable company and focusing on delivering exceptional results for all shareholders.
About Verde Bio Holdings, Inc.
Verde Bio Holdings, Inc. (OTCQB: VBHI) is an Energy Company based in Frisco, Texas, engaged in the acquisition and management of Mineral and Royalty interests in lower risk, onshore oil and gas properties within the major oil and gas plays in the U.S. The Company’s dual-focused growth strategy relies primarily on leveraging management’s expertise to grow through the strategic acquisition of revenue producing royalty interest and strategic and opportunistic non-operated working interests. www.verdebh.com
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
Statements in this press release that are not strictly historical are “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These statements involve a high degree of risk and uncertainty, are predictions only and actual events or results may differ materially from those projected in such forward-looking statements. Factors that could cause or contribute to differences include the uncertainty regarding viability and market acceptance of the Company’s products and services, the ability to complete software development plans in a timely manner, changes in relationships with third parties, product mix sold by the Company and other factors described in the Company’s most recent periodic filings with the Securities and Exchange Commission, including its 2022 Annual Report on Form 10-K and quarterly reports on Form 10-Q.
Contact:
Kirin Smith, President
PCG Advisory, Inc.
ksmith@pcgadvisory.com
FAQ
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