RAM Energy Resources Restates Certain Financial Statements
01 Dezember 2009 - 10:35PM
Business Wire
RAM Energy Resources, Inc. (Nasdaq: RAME) announced that it will
be filing an amendment to the company’s annual report on Form 10-K
for the year ended December 31, 2008 and simultaneously will be
filing amendments to its quarterly reports on Form 10-Q for the
periods ended March 31, June 30 and September 30, 2009, primarily
to restate impairment expense, depreciation and amortization
expense, and related provision for income tax benefit, all as
reflected in the financial statements for those periods as
originally issued. The correction of these errors results in
reducing the net loss reported by the company for 2008 by $8.1
million, with a corresponding positive change to stockholders’
equity, and reducing the net loss reported for the first nine
months of 2009 by $6.9 million, also with a corresponding positive
change to stockholders’ equity. All of the changes effected by the
restatement are to non-cash items.
The estimate of RAM’s proved oil and natural gas reserves for
the period ended December 31, 2008 prepared by the company’s
independent petroleum engineers and utilized in connection with the
preparation of the year-end financial statements, and the company’s
internal reserve report prepared in connection with the preparation
of the March 31, 2009 unaudited financial statements, inadvertently
included certain properties that were uneconomic at period-end
commodity prices and development costs, thereby overstating reserve
quantities and associated future development costs and resulting in
the financial statement errors corrected by the restatement. Due to
the errors in the reserve reports, future net revenues from the
company’s proved oil and natural gas properties discounted at 10%,
or PV-10 Value, was understated by $10.7 million at December 31,
2008 and was also understated at March 31, 2009.
The errors in the company’s reserve reports were limited to the
reserve reports prepared for year-end 2008 and first quarter 2009
periods. The error of inclusion of uneconomic properties did not
carry forward into reserve reports prepared for the period ended
June 30, 2009. Procedures utilized by the company in finalizing and
incorporating reserve data into the financial statements have been
modified to prevent the reoccurrence of the error in future
periods. While management believed that the effect of these
non-cash errors was not material to the company’s financial
statements as issued and this position was concurred with by RAM’s
independent auditors, after an extended period of review and
discussion with the SEC staff, management and the audit committee
of the company’s board of directors determined that it was in the
best interests of the company and its stockholders to restate the
financial statements and issue an amended annual report and amended
quarterly reports reflecting the corrections.
Forward-Looking Statements
This release includes certain statements that may be deemed to
be “forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements in this
release, other than statements of historical facts, that address
intended SEC filings with the SEC, estimates of changes and
corrected amounts in restated financial statements and events or
developments that the company expects or believes are
forward-looking statements. Although the company believes the
expectations expressed in such forward-looking statements are based
on reasonable assumptions, such statements are not guarantees of
future performance and actual results or developments may differ
materially from those in the forward-looking statements. Factors
that could cause actual results to differ materially from those in
forward-looking statements include, actions taken and to be taken
by the government as a result of statutory interpretation, as well
as other risk factors described from time-to-time in the company’s
filings with the SEC. The company assumes no obligation to update
publicly such forward-looking statements, whether as a result of
new information, future events or otherwise.
About RAM Energy Resources
RAM Energy Resources, Inc. is an independent energy company
engaged in the acquisition, exploitation and exploration of oil and
gas properties and the marketing of natural gas and crude oil.
Company headquarters are in Tulsa, Oklahoma, and its common shares
are traded on the Nasdaq under the symbol RAME. For additional
information, visit the company website at www.ramenergy.com.
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