Harvest Natural Resources Inc. (HNR, Financial) filed Quarterly Report for the period ended 2010-03-31.
Harvest Natural Resources Inc. has a market cap of $271 million; its shares were traded at around $8.15 with and P/S ratio of 1497.7. HNR is in the portfolios of Mohnish Pabrai of Pabrai Mohnish, George Soros of Soros Fund Management LLC, Jim Simons of Renaissance Technologies LLC.
At March 31, 2010, we had current assets of $57.7 million and current liabilities of $12.7 million, resulting in working capital of $45.0 million and a current ratio of 4.5:1. This compares with a working capital of $34.2 million and a current ratio of 3.0:1 at December 31, 2009. The increase in working capital of $10.8 million was primarily due to proceeds received from the debt offering offset by an increase in capital expenditures, exploration costs and administrative expenses.
Cash Flow used in Operating Activities. During the three months ended March 31, 2010 and 2009, net cash used in operating activities was approximately $1.4 million and $8.7 million, respectively. The $7.3 million decrease was primarily due to decreases in accounts and notes receivable and advances to equity affiliates and increases in accounts payable and accrued expenses offset by the payments of accrued interest and income taxes. The three months ended March 31, 2010, also included $3.1 million in oil and gas revenue from the Monument Butte Extension and Lower Green River/Upper Wasatch areas in Utah.
Cash Flow from Investing Activities. During the three months ended March 31, 2010, we had cash capital expenditures of approximately $13.5 million. Of the 2010 expenditures, $10.7 million was attributable to activity on the Antelope projects, $2.3 million was attributable to activity on the Budong PSC, $0.4 million was attributable to activity on the Dussafu PSC and $0.1 million was attributable to other projects. During the three months ended March 31, 2009, we had cash capital expenditures of approximately $7.1 million. Of the 2009 expenditures, $4.8 million was attributable to the Antelope projects and $2.3 million to other projects.
During the three months ended March 31, 2010, we deposited with a U.S. bank $1.0 million as collateral for a standby letter of credit issued in support of a bank guarantee required as a performance guarantee for a joint study. During the three months ended March 31, 2009, we deposited with a U.S. bank $1.7 million as collateral for two standby letters of credit issued in support of bank guarantees required as part of a project binding process. During the three months ended March 31, 2010 and 2009, we incurred $1.7 million and $0.5 million, respectively, of investigatory costs related to various international and domestic exploration studies.
Cash Flow from Financing Activities. During the three months ended March 31, 2010, we closed an offering of $32.0 million in aggregate principal amount of our 8.25 percent senior convertible notes, $2.5 million in deferred financings costs related to the $32.0 million convertible debt offering that are being amortized over the life of the financial instrument and $0.1 million in legal fees associated with a prospective financing. During the three months ended March 31, 2009, we incurred $0.8 million in legal fees associated with a prospective financing.
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Harvest Natural Resources Inc. has a market cap of $271 million; its shares were traded at around $8.15 with and P/S ratio of 1497.7. HNR is in the portfolios of Mohnish Pabrai of Pabrai Mohnish, George Soros of Soros Fund Management LLC, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
Two drill sites were selected in 2009. Operational activities during the three months ended March 31, 2010 focused on well planning, construction for the two test well sites, mobilization of rig and ancillary equipment to the first drill site, and purchase of drilling equipment. It is expected that the first of two exploratory wells will spud late in the second quarter of 2010. In accordance with the farm-in agreement, we expect to fund 100 percent of the well expenditures to earn our 47 percent working interest up to a cap of $10.7 million; thereafter, we will pay in proportion to our working interest. During the three months ended March 31, 2010, we incurred $2.3 million for well planning, construction and drilling equipment, and $0.5 million for seismic data processing and reprocessing. The remaining 2010 budget for the Budong PSC is $12.1 million. Contingent on the successful results of the two exploratory test wells and availability of funds, this 2010 budget could be increased by an additional $13.1 million.At March 31, 2010, we had current assets of $57.7 million and current liabilities of $12.7 million, resulting in working capital of $45.0 million and a current ratio of 4.5:1. This compares with a working capital of $34.2 million and a current ratio of 3.0:1 at December 31, 2009. The increase in working capital of $10.8 million was primarily due to proceeds received from the debt offering offset by an increase in capital expenditures, exploration costs and administrative expenses.
Cash Flow used in Operating Activities. During the three months ended March 31, 2010 and 2009, net cash used in operating activities was approximately $1.4 million and $8.7 million, respectively. The $7.3 million decrease was primarily due to decreases in accounts and notes receivable and advances to equity affiliates and increases in accounts payable and accrued expenses offset by the payments of accrued interest and income taxes. The three months ended March 31, 2010, also included $3.1 million in oil and gas revenue from the Monument Butte Extension and Lower Green River/Upper Wasatch areas in Utah.
Cash Flow from Investing Activities. During the three months ended March 31, 2010, we had cash capital expenditures of approximately $13.5 million. Of the 2010 expenditures, $10.7 million was attributable to activity on the Antelope projects, $2.3 million was attributable to activity on the Budong PSC, $0.4 million was attributable to activity on the Dussafu PSC and $0.1 million was attributable to other projects. During the three months ended March 31, 2009, we had cash capital expenditures of approximately $7.1 million. Of the 2009 expenditures, $4.8 million was attributable to the Antelope projects and $2.3 million to other projects.
During the three months ended March 31, 2010, we deposited with a U.S. bank $1.0 million as collateral for a standby letter of credit issued in support of a bank guarantee required as a performance guarantee for a joint study. During the three months ended March 31, 2009, we deposited with a U.S. bank $1.7 million as collateral for two standby letters of credit issued in support of bank guarantees required as part of a project binding process. During the three months ended March 31, 2010 and 2009, we incurred $1.7 million and $0.5 million, respectively, of investigatory costs related to various international and domestic exploration studies.
Cash Flow from Financing Activities. During the three months ended March 31, 2010, we closed an offering of $32.0 million in aggregate principal amount of our 8.25 percent senior convertible notes, $2.5 million in deferred financings costs related to the $32.0 million convertible debt offering that are being amortized over the life of the financial instrument and $0.1 million in legal fees associated with a prospective financing. During the three months ended March 31, 2009, we incurred $0.8 million in legal fees associated with a prospective financing.
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