CAMBER ENERGY, INC. (CEI)·Q4 2016 Earnings Summary

Executive Summary

• Calendar Q4 2016 (fiscal Q3 2017) showed a sharp top-line and volume ramp from the August Segundo acquisition, but results were burdened by financing, one-time charges, and a leveraged balance sheet. Revenue rose to $1.91M; production averaged 995 BOE/d; net loss was $4.40M ($0.20/sh) with $1.3M in one-time costs ($0.06/sh) .
• Management emphasized optimized production on acquired assets and outlined a 2017 drilling plan, including entry into the Permian’s horizontal San Andres play in H2 2017; Oklahoma drilling slated for 1H 2017 .
• Operating cost metrics improved: LOE/BOE fell to $14.18 vs $36.75 YoY; DD&A/BOE dropped to $14.05 vs $136.15 YoY, reflecting mix/scale benefits post-acquisition .
• Estimate context: S&P Global consensus for CEI was not available for the period; no beat/miss analysis can be provided (consensus unavailable via SPGI mapping).

What Went Well and What Went Wrong

What Went Well

• Production ramp and asset optimization: average December 2016 rate reached 1,054 BOE/d; quarter averaged ~995 BOE/d (vs. 54 BOE/d YoY), driven by Segundo assets and field workovers; total quarterly production 91,591 BOE .
• Cost per BOE improved: LOE averaged $14.18/BOE (vs. $36.75/BOE YoY); DD&A $14.05/BOE (vs. $136.15/BOE YoY) as scale improved post-acquisition .
• Strategic expansion: “We… acquired leasehold interests in the Central Platform of the Permian Basin, targeting the developing horizontal San Andres play… We plan to begin drilling… in the latter half of 2017… This is a significant step for our Company” — Anthony C. Schnur, CEO .

What Went Wrong

• Profitability and financing burden: Net loss of $4.40M included $1.46M interest expense and $0.87M other expense; non-cash interest ~$0.8M; $1.0M of transaction-related fees .
• Liquidity/going concern: Working capital deficit of $6.6M; company disclosed substantial doubt about ability to continue as a going concern without additional financing .
• Leverage and structure: IBC loan balance ~$39.0M outstanding; Series B and Series C preferred stocks add dividend and potential conversion overhangs; Rogers loan maturity extended to April 30, 2017 .

Financial Results

Income statement, costs, and volumes

Notes: Q2 FY2017 net loss includes $48.99M non-cash impairment tied to acquisition price vs. asset value . Q3 FY2017 one-time charges totaled $1.3M ($0.06/sh) .

KPIs and non-GAAP

Segment breakdown: Not applicable; CEI reports as a single E&P segment .

Balance sheet and liquidity (period-end Dec 31, 2016)

• Cash and restricted cash: $4.38M ($1.98M cash; $2.40M restricted) .
• Working capital deficit: $(6.64)M .
• IBC loan: $39.0M outstanding (secured; min interest 5.5%) .
• Series B Preferred: 552,000 shares issued (6% dividend, convertible ~7.14:1) .
• Series C Preferred outstanding/converted per subsequent events; conversion features and elevated dividend rate noted .

Guidance Changes

No formal numerical guidance was provided; management offered directional and timing commentary.

Earnings Call Themes & Trends

No earnings call transcript was found in our database; themes below reflect disclosures across the prior two quarters and current period.

Management Commentary

• “These efforts have resulted in an approximate 20% increase in our existing production rate to 1,054 BOE/day for the month of December 2016… We expect further production improvement as we continue optimizing existing assets and embark upon a drilling initiative.” — Anthony C. Schnur, CEO .
• “In January 2017, we acquired leasehold interests in the Central Platform of the Permian Basin, targeting the developing horizontal San Andres play… We plan to begin drilling in the San Andres… estimated… in the latter half of 2017.” — Anthony C. Schnur .
• “We have participated in two Eagle Ford shale wells and are assessing additional drilling… In Oklahoma, we are… preparing two locations… in the first half of calendar 2017.” — Anthony C. Schnur .
• Name change and strategic rebrand: “We changed our name from Lucas Energy, Inc. to Camber Energy, Inc. effective January 5, 2017” to reflect the strategic shift .

Q&A Highlights

No earnings call transcript was available for the period; CEI did not have a transcript in our database for fiscal Q3 2017 (calendar Q4 2016). Accordingly, Q&A highlights and any call-specific guidance clarifications are unavailable.

Estimates Context

• Wall Street consensus from S&P Global was unavailable for CEI for Q1–Q3 FY2017 (SPGI mapping not present), implying limited or no formal analyst coverage for the quarters under review. As a result, no beat/miss analysis versus consensus can be provided (consensus unavailable).

Key Takeaways for Investors

• Operational inflection from the Segundo acquisition is visible: revenue and BOE/d accelerated, with improving per-unit costs; sustaining these gains hinges on continued optimization and funding for drilling .
• Leverage and liquidity are the main risks: $39.0M IBC loan, working capital deficit, and going-concern language signal ongoing financing needs that could drive dilution or asset sales if not addressed .
• 2017 drilling (Oklahoma 1H; San Andres H2) offers potential production catalysts but is explicitly “funding permitting”; timing and execution will be critical to the medium-term thesis .
• One-time charges and complex capital structure (Series B/C preferred) continue to affect reported results and share issuance dynamics; monitor subsequent conversions/dividends and related cash/non-cash impacts .
• With no published consensus, stock moves likely key off operational updates (production, well results), financing milestones (refinancing/asset monetizations), and cost trajectory, rather than traditional beat/miss narratives (consensus unavailable).

Sources:

• 8-K (Earnings Release) for fiscal Q3 2017 (period ending Dec 31, 2016) and Exhibit 99.1 press release .
• 10-Q for quarter ended Dec 31, 2016 (filed Feb 14, 2017) .
• Prior quarters: 10-Q for quarter ended Sep 30, 2016 ; 8-K press release for fiscal Q1 2017 (Jun 30, 2016) .