Gasco Energy, Inc. (AMEX: GSX, GSX message board) has received a notice of listing deficiency from NYSE Amex, as the company disclosed on Tuesday after market hours. Gasco had been warned on June 25, 2009, when they have received a letter pointing out that the company did not meet minimum listing requirements related to stockholders equity.
Following the NYSE Amex listing requirement, all companies must retain stockholders equity above the $2 million limit. Gasco had a difficult time retaining the measurement at required level over the latest quarter.
The company is also non-compliant with another requirement of retaining profitability. Gasco has posted losses in two out of three recent years of operations. Although the company had finally carved its way to profitability in 2008, a huge loss over the first quarter of 2009 shows they are still far away from sustained profits.
The notice of possible delisting isn't really that bad yet. Gasco has to make a plan of how they intend to cope with the matter and submit it by July 27, 2009. The company still has plenty of time to improve their situation before any real threat of delisting kicks in.
On the other hand, Gasco has a limited borrowing capability because of their current credit agreement, having $44 million in outstanding loans under a $45 million borrowing base. Because of the restricted borrowing capacity it will be harder for the company to get in tact with the listing requirements.
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