Brek Announces Second Quarter Financial Results

Business Wire,  August 21, 2002  

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Business Editors

HONG KONG--(BUSINESS WIRE)--Aug. 21, 2002

Company focuses on securing direct ownership of oil and

gas properties

Brek Energy Corporation (NASDAQ:BREK)(BSX:BREK)(BSX:BREK BH) today announced the filing of its Form 10Q and financial results for the second quarter ended June 30, 2002.

Brek, which is still in the development stage, posted revenue from its continuing payment processing operations for the quarter of $14,735 as compared with revenue for the same quarter in 2001 of $24,152. Revenue from the continuing payment processing operations for the six months ended June 30, 2002 was $27,605 as compared to $36,908 for the six months ended June 30, 2001. Both the three months and six months ended June 30, 2001 included revenue of $13,016 from the Company's former operations in Bermuda which was sold in October 2001.

Net loss for the second quarter of 2002 after amortization, depreciation, asset impairment charges and non-cash compensation associated with stock options was $3,414,308 as compared to the second quarter of 2001 net loss of $1,580,568. Net loss for the six months ended June 30, 2002, after amortization, depreciation, asset impairment charges and non-cash compensation associated with stock options was $5,381,714 as compared to the six months ended June 30, 2001 net loss of $2,049,070. During the three months and six months ended June 30, 2001 the Company recovered $231,668 and $318,241respectively of non-cash compensation costs associated with stock options due to discontinuance of operations and reduction of employees as compared to non-compensation costs of $270,800 and $486,500 during the respective three and six months periods ended June 30, 2002. During the three and six months ended June 30, 2002 the Company realized impairment charges of $116,597 on its payment processing assets and $1,129,189 to reduce the carrying value of its Gasco shares to market value.

Net loss per share for the current quarter was $ 0.15 per share as compared to $ 0.08 per share for the same quarter in 2001. Net loss per share for the six months ended June 30, 2002 was $ 0.26 per share as compared to $ 0.10 per share for the six months ended June 30, 2001.

During the second quarter of 2002, the Company has concentrated its efforts in securing direct ownership in oil and gas prospects and this resulted in firstly, acquiring a 51.5% equity interest and 61.7% voting interest in Vallenar Energy Corp. on June 28, 2002 and completing the exchange of its former shareholdings in Gasco Energy, Inc. for a 25% undivided interest in all of Gasco's undeveloped mineral leases which was completed on July 16, 2002.

"This past quarter has marked a real turning point for the company." Said Gregory Pek, President and CEO of Brek. "Our recurring cash operating costs have continued to decline dramatically. This has, to a large degree, been masked by the costs of severance pay for terminated staff, non-cash compensation costs, and unusually large professional fees incurred principally to deal with the Gasco relationship. Additionally, accounting rules required us to significantly write down the carrying cost of the properties we acquired in the property-for-share exchange with Gasco, though in our view the properties' real value continues to increase as a result of ongoing, successful drilling activities."

"The big news continues to relate to our properties. In the current quarter we have commenced drilling, by participating with Phillips Petroleum and Gasco, in the Riverbend Basin in Utah. We have also drilled our own exploratory well in Edwards County, Texas. We will be announcing the results of this well in the next few days once we have our engineers' detailed analyses. Preliminary indications are, however, better than we anticipated."

Financial Summary

Brek Energy Corporation (Formerly First Ecom.com, Inc.)
Financial Highlights
(Unaudited)

                            Quarter Ended        Six Months Ended
                     June 30,    June 30,    June 30,     June 30,
                         2002        2001        2002        2001
                            $           $           $           $
Revenues               14,735      24,152      27,605      36,908
Operating (loss)  (1,940,466) (1,634,884) (3,490,036) (3,789,813)
Net (Loss)        (3,414,308) (1,580,568) (5,381,714) (2,049,070)
Basic and diluted
 net loss per share    (0.15)      (0.08)      (0.26)      (0.10)
Shares used to
 compute basic and
 diluted net loss
 per share         22,055,037  19,210,037  20,703,269  19,210,037

About Brek Energy Corporation

Brek Energy Corporation is an exploration and development company with interests in non-conventional oil and gas resources in Texas and the Rocky Mountains. Brek Energy Corporation, formerly First Ecom.com Inc., also provides electronic payment solutions through its wholly owned subsidiary, First Ecom Systems Limited. The Company has a national market listing and its common shares trade on the NASDAQ National Market System under the symbol BREK.