-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, LNi07OHy5zEfI2cbt9mWoYnoTDH8tb+LQaMvQwTVhDZVZkFPIZxL6TYIR/vgqMHa LhvqqbWMZv84wH/AIdvKzw== 0000833320-94-000007.txt : 19941116 0000833320-94-000007.hdr.sgml : 19941116 ACCESSION NUMBER: 0000833320-94-000007 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19940930 FILED AS OF DATE: 19941114 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BURLINGTON RESOURCES INC CENTRAL INDEX KEY: 0000833320 STANDARD INDUSTRIAL CLASSIFICATION: 1311 IRS NUMBER: 911413284 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09971 FILM NUMBER: 94559475 BUSINESS ADDRESS: STREET 1: 5051 WESTHEIMER STREET 2: SUITE 1400 CITY: HOUSTON STATE: TX ZIP: 77056 BUSINESS PHONE: 7136249500 MAIL ADDRESS: STREET 1: 999 THIRD AVENUE CITY: SEATTLE STATE: WA ZIP: 98104-4097 10-Q 1 FORM 10-Q FOR PERIOD ENDED 9/30/94 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1994 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-9971 BURLINGTON RESOURCES INC. (Exact name of registrant as specified in its charter) Delaware 91-1413284 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 5051 Westheimer, Houston, Texas 77056 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (713) 624-9500 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes (X) No ( ) Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding Common Stock, par value $.01 per share as of September 30, 1994 126,794,147 PART 1 - FINANCIAL INFORMATION ITEM 1. Financial Statements BURLINGTON RESOURCES INC. CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
THIRD QUARTER NINE MONTHS 1994 1993 1994 1993 (In Thousands, Except per Share Amounts) Revenues...............................$ 314,037 $ 309,457 $ 935,202 $ 938,119 Costs and Expenses..................... 274,645 252,920 780,525 745,922 ---------- ---------- ---------- ---------- Operating Income....................... 39,392 56,537 154,677 192,197 Interest Expense....................... 24,673 17,344 64,440 54,729 Other Income (Expense) - Net........... 2,038 (1,742) 1,970 126,332 ---------- ---------- ---------- ---------- Income from Continuing Operations Before Income Taxes.................. 16,757 37,451 92,207 263,800 Income Tax Expense (Benefit)........... (3,938) 13,141 (9,220) 60,674 ---------- ---------- ---------- ---------- Income from Continuing Operations...... 20,695 24,310 101,427 203,126 Income from Discontinued Operations - Net of Income Taxes................ - 277 - 1,138 ---------- ---------- ---------- ---------- Net Income.............................$ 20,695 $ 24,587 $ 101,427 $ 204,264 ========== ========== ========== ========== Earnings per Common Share: Continuing Operations................$ .16 $ .18 $ .78 $ 1.55 Discontinued Operations.............. - - - .01 ---------- ---------- ---------- ---------- Total................................$ .16 $ .18 $ .78 $ 1.56 ========== ========== ========== ==========
See Accompanying Notes to Consolidated Financial Statements. - 2 - BURLINGTON RESOURCES INC. CONSOLIDATED BALANCE SHEET (UNAUDITED)
September 30, December 31, 1994 1993 (In Thousands) ASSETS Current Assets: Cash and Short-term Investments.............................$ 4,923 $ 19,784 Accounts Receivable......................................... 173,737 218,361 Inventories................................................. 34,690 23,954 Other Current Assets........................................ 25,402 14,572 ----------- ----------- 238,752 276,671 ----------- ----------- Oil & Gas Properties (Successful Efforts Method).............. 5,725,345 5,027,312 Other Properties.............................................. 546,064 540,342 ----------- ----------- 6,271,409 5,567,654 Accumulated Depreciation, Depletion and Amortization........ 1,838,346 1,631,941 ----------- ----------- Properties - Net........................................... 4,433,063 3,935,713 ----------- ----------- Other Assets.................................................. 179,114 235,336 ----------- ----------- Total Assets...............................................$ 4,850,929 $ 4,447,720 =========== =========== LIABILITIES Current Liabilities: Accounts Payable............................................$ 174,522 $ 202,565 Taxes Payable............................................... 70,236 58,372 Other Current Liabilities................................... 32,291 38,680 ----------- ----------- 277,049 299,617 ----------- ----------- Long-term Debt................................................ 1,302,152 819,071 ----------- ----------- Deferred Income Taxes......................................... 539,670 566,758 ----------- ----------- Other Liabilities and Deferred Credits........................ 189,201 154,216 ----------- ----------- Commitments and Contingent Liabilities STOCKHOLDERS' EQUITY Common Stock, Par Value $.01 Per Share (Authorized 325,000,000 Shares; Issued 150,000,000 Shares)... 1,500 1,500 Paid-in Capital............................................... 2,936,696 2,936,934 Retained Earnings............................................. 515,760 467,667 ----------- ----------- 3,453,956 3,406,101 Cost of Treasury Stock (1994, 23,205,853 Shares; 1993, 20,316,521 Shares).......... 911,099 798,043 ----------- ----------- Common Stockholders' Equity................................... 2,542,857 2,608,058 ----------- ----------- Total Liabilities and Common Stockholders' Equity...........$ 4,850,929 $ 4,447,720 =========== ===========
See Accompanying Notes to Consolidated Financial Statements. - 3 - BURLINGTON RESOURCES INC. CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
NINE MONTHS 1994 1993 (In Thousands) Cash Flows From Continuing Operating Activities: Income from Continuing Operations.................................$ 101,427 $ 203,126 Adjustments to Reconcile Income to Net Cash Provided By Continuing Operating Activities: Depreciation, Depletion and Amortization......................... 244,765 212,230 Deferred Income Taxes............................................ (27,099) (13,086) Exploration Costs................................................ 26,857 18,251 Working Capital Changes: Accounts Receivable............................................. 44,624 (14,025) Inventories..................................................... (10,736) (14,262) Other Current Assets............................................ (10,830) 65,626 Accounts Payable................................................ (28,043) (9,351) Taxes Payable................................................... 11,864 38,348 Other Current Liabilities....................................... (6,389) (15,344) Gain on Sales and Other........................................... 25,135 (121,908) ---------- ---------- Net Cash Provided By Continuing Operating Activities........... 371,575 349,605 ---------- ---------- Cash Flows From Continuing Investing Activities: Additions to Properties........................................... (751,250) (426,740) Proceeds from Sales and Other..................................... 58,200 166,383 ---------- ---------- Net Cash Used In Continuing Investing Activities............... (693,050) (260,357) ---------- ---------- Cash Flows From Continuing Financing Activities: Proceeds from Long-term Financing................................. 481,580 - Reduction in Long-term Debt.. .................................... - (160,897) Dividends Paid.................................................... (53,508) (51,803) Treasury Stock Transactions - Net. ............................... (113,056) 56,719 Other............................................................. (31,335) 51,333 ---------- ---------- Net Cash Provided By (Used In) Continuing Financing Activities......................................... 283,681 (104,648) ---------- ---------- Decrease in Cash and Short-term Investments from Continuing Operations............................................ (37,794) (15,400) Cash Provided By (Used In) Discontinued Operations................. 22,933 (6,709) Cash and Short-term Investments: Beginning of Year................................................ 19,784 31,729 ---------- --------- End of Period....................................................$ 4,923 $ 9,620 ========== ==========
See Accompanying Notes to Consolidated Financial Statements. - 4 - BURLINGTON RESOURCES INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. BASIS OF PRESENTATION The 1993 Annual Report on Form 10-K of Burlington Resources Inc.(the"Company") includes certain definitions and a summary of significant accounting policies and should be read in conjunction with this Quarterly Report on Form 10-Q. The statements for the periods presented herein are unaudited, condensed and do not contain all information required by generally accepted accounting principles to be included in a full set of financial statements. In the opinion of management, all material adjustments necessary to present fairly the results of operations have been included. All such adjustments are of a normal, recurring nature. The results of operations for any interim period are not necessarily indicative of the results of operations for the entire year. Earnings per common share is based on the weighted average number of common shares outstanding on a year to date basis. The weighted average number of common shares outstanding was 130 million and 131 million for the first nine months of 1994 and 1993, respectively. - 5 - ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Financial Condition and Liquidity The total long-term debt to capital (total long-term debt and stockholders' equity) ratio at September 30, 1994, and December 31, 1993, was 34 percent and 24 percent, respectively. In May 1994, the Company issued $300 million of 7.15% Notes due May 1, 1999. The net proceeds were used for general corporate purposes, including acquisition of oil and gas properties, repayment of commercial paper and other capital expenditures. In July 1994, the Company increased the capacity under its shelf registration statements from $200 million to $500 million. In July 1994, the Company established new revolving credit facilities to replace the previous $900 million facility that was due to expire in June 1996. The new credit facilities are comprised of a $600 million revolving credit agreement that expires in July 1999 and a $300 million revolving credit agreement that expires July 1995, but is renewable annually by mutual consent. The new revolving credit facilities retain the same debt covenants as the previous credit facility. As of September 30, 1994, there were no borrowings outstanding under the credit facilities although borrowing capacity is reduced by outstanding commercial paper. At September 30, 1994, the Company had outstanding commercial paper borrowings of $253 million at an average interest rate of 5.05 percent. During the first nine months of 1994, the Company purchased approximately 2.8 million shares of its common stock for $112 million of which 2.2 million shares were purchased in the third quarter. Since December 1988, the Company has repurchased 26.9 million shares under three 10 million share repurchase authorizations. Net cash provided by continuing operating activities for the first nine months of 1994 was $372 million compared to $350 million for the first nine months of 1993. The increase is primarily due to lower income tax payments and other working capital changes partially offset by decreased operating income. In an effort to maintain its high quality asset base, the Company continues to divest marginal and non-strategic properties. In addition, the Company conveyed working interests in certain coal seam natural gas wells in November 1994. The net proceeds, after tax, from all 1994 property transactions will be approximately $115 million. The Company is involved in certain environmental proceedings and other related matters. Although it is possible that new information or future developments could require the Company to reassess its potential exposure related to these matters, the Company believes, based upon available information, the resolution of these issues, individually and in the aggregate, will not have a materially adverse effect on the consolidated financial position or results of operations of the Company. - 6 - Capital Expenditures Capital expenditures for the first nine months of 1994 totaled $751 million compared to $427 million for the same period in 1993 and are projected to be approximately $890 million for all of 1994. The projected 1994 capital expenditures will consist of approximately $490 million for producing property and reserve acquisitions along with approximately $400 million for the development of oil and gas properties and related facilities. The $490 million expected to be spent for acquisitions includes the $375 million purchase of Maxus Energy Corporation's properties announced in the second quarter of this year. Capital expenditures will be funded from internal cash flow supplemented, as needed, by external financing. Dividends On October 6, 1994, the Board of Directors declared a common stock quarterly dividend of $0.1375 per share, payable January 3, 1995. - 7 - Results of Continuing Operations - Third Quarter 1994 Compared to Third Quarter 1993 Income from Continuing Operations for the third quarter of 1994 was $21 million or $.16 per share compared to $24 million or $.18 per share in 1993. The 1993 results include a non-recurring charge of $16 million or $.12 per share due to an increase in the corporate tax rate as a result of the Budget Reconciliation Act of 1993. Operating income for the third quarter of 1994 was $39 million compared to $57 million in 1993. Revenues were $314 million for the third quarter of 1994 compared to $309 million in 1993. Natural gas sales volumes improved 21 percent to 1,077 MMCF per day which increased revenues $29 million. Oil sales volumes improved 14 percent to 46.8 MBbls per day and average oil sales prices improved 8 percent to $16.97 per barrel which increased revenues $8 million and $5 million, respectively. Gas and oil sales volumes increased primarily due to continued development of the Company's oil and gas properties and producing property acquisitions. Processing and transportation revenues increased $4 million primarily due to higher volumes. The revenue increases were partially offset by a 16 percent decline in 1994 average natural gas sales prices to $1.42 per MCF which decreased revenues $28 million and a $14 million decrease in intrastate natural gas sales and NGL revenues due to lower sales prices and volumes. Costs and expenses were $275 million for the third quarter of 1994 compared to $253 million in 1993. The increase was primarily due to a 19 percent improvement in 1994 production levels which increased production and processing related expenses $33 million and a $3 million increase in exploration costs. These increases were partially offset by a $15 million decrease in intrastate natural gas and NGL product purchases. Interest expense was $25 million for the third quarter of 1994 compared to $17 million in 1993. The increase was primarily due to additional debt issued in May 1994 and higher outstanding commercial paper balances during the third quarter of 1994. The effective income tax rate was a benefit of 24 percent for the third quarter of 1994 compared to an expense of 35 percent for the third quarter of 1993. The 1994 beneficial tax rate is due to recognized nonconventional fuel tax credits being greater than the Company's tax expense at statutory tax rates. The third quarter 1994 tax rate is significantly lower than the same quarter in 1993 primarily due to the additional income tax expense recognized for the August 1993 enactment of an increase in the corporate income tax rate. - 8 - Results of Continuing Operations - Nine Months 1994 Compared to Nine Months 1993 Income from Continuing Operations for the first nine months of 1994 was $101 million or $.78 per share compared to $203 million or $1.55 per share in 1993. The 1993 results include a total of $.47 per share from gains on the sale of the Burlington Resources Coal Seam Gas Royalty Trust (the "Trust") units and the exchange of Company debt for Anadarko Petroleum Corporation ("Anadarko") common stock, and a charge to reflect the increase in the corporate income tax rate. Operating income for the first nine months of 1994 was $155 million compared to $192 million in 1993. Revenues were $935 million for the first nine months of 1994 compared to $938 million in 1993. Natural gas sales volumes improved 13 percent to 1,036 MMCF per day and oil sales volumes improved 7 percent to 44.7 MBbls per day which increased revenues $57 million and $14 million, respectively. Gas and oil sales volumes increased primarily due to continued development of the Company's oil and gas properties and producing property acquisitions. Processing and transportation revenues increased $13 million primarily due to higher volumes. The revenue increases were offset by a 6 percent decline in 1994 average natural gas sales prices to $1.59 per MCF and a 10 percent decline in 1994 average oil sales prices to $15.70 per barrel which decreased revenues $28 million and $21 million, respectively. In addition, NGL revenues decreased $39 million due to lower sales prices and volumes. Costs and expenses were $781 million for the first nine months of 1994 compared to $746 million in 1993. The increase was primarily due to a 12 percent improvement in 1994 production levels which increased production related expenses $65 million and a $9 million increase in exploration costs. These increases were partially offset by a $41 million decline in NGL product purchases. Interest expense was $64 million for the first nine months of 1994 compared to $55 million in 1993. The increase was primarily due to additional debt issued in May 1994 and higher outstanding commercial paper balances during 1994. Other Income - Net was $2 million for the first nine months of 1994 compared to $126 million in 1993. The 1993 amount includes a $108 million gain on the sale of the Trust units and a $19 million gain from the exchange of Company debt for Anadarko common stock. The effective income tax rate was a benefit of 10 percent for the first nine months of 1994 compared to an expense of 23 percent for the first nine months of 1993 and 17 percent for the full year 1993. The effective tax rate for the first nine months of 1994 is significantly lower than the same period in 1993 because 1994 did not include any of the special nonrecurring items that increased income taxes in 1993. The special nonrecurring items included the second quarter 1993 gains from the sale of the Trust units and from the exchange of Company debt for Anadarko common stock and the additional income tax expense recognized for the August 1993 enactment of an increase in the corporate income tax rate. Without the additional tax expense associated with these gains and the nonrecurring portion of the tax rate increase, the effective tax rate for the first nine months of 1993 was a benefit of 4 percent. The 1994 beneficial tax rate is due to recognized nonconventional fuel tax credits being greater than the Company's tax expense at statutory tax rates. - 9 - Nine Months 1994 Compared to Nine Months 1993 - Continued The Company expects to have a substantially higher beneficial tax rate for the year ending 1994 as compared to the first nine months of 1994. The higher beneficial tax rate is primarily due to an increase in the Company's nonconventional fuel tax credits recognized as a result of increased taxable income from the disposition of certain coal seam properties discussed under "Financial Condition and Liquidity." The anticipated higher beneficial tax rate should result in higher net income and earnings per common share in the fourth quarter of 1994. - 10 - PART II - OTHER INFORMATION ITEM 6. Exhibits and Reports on Form 8-K A. Exhibits The following exhibits are filed as part of this report. Exhibit Nature of Exhibit Page 4.1 The Company and its subsidiaries either * have filed with the Securities and Exchange Commission or upon request will furnish a copy of any instrument with respect to long-term debt of the Company. 11.1 Earnings per share computation. 12.1 Ratio of Earnings to Fixed Charges. 27.1 Financial Data Schedule. * - Exhibit incorporated by reference. B. Reports on Form 8-K The Company filed a Form 8-K dated October 10, 1994 which announced the promotion of Bobby S. Shackouls to the office of President and Chief Executive Officer of Meridian Oil Inc., a wholly owned subsidiary of the Company. Mr. Shackouls replaces George E. Howison, who is taking early retirement. Items 1, 2, 3, 4 and 5 of Part II are not applicable and have been omitted. - 11 - Pursuant to the requirements of Section 13 (or 15(d)) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. BURLINGTON RESOURCES INC. (Registrant) By /s/ John E. Hagale John E. Hagale Senior Vice President and Chief Financial Officer By /s/ Hays R. Warden Hays R. Warden Vice President & Controller Date: November 14, 1994 - 12 - EX-11 2 EARNINGS PER SHARE COMPUTATION BURLINGTON RESOURCES INC. EARNINGS PER SHARE COMPUTATION EXHIBIT 11.1 (UNAUDITED)
THIRD QUARTER 1994 1993 Earnings Shares Earnings Shares Primary earnings per common share: Net earnings available for common stock and weighted average number of common shares outstanding..........................$ 20,695 127,939 $ 24,587 130,131 Stock options assumed exercised-net........... - 714 - 1,462 --------- ------- --------- ------- Total net earnings and primary common shares..$ 20,695 128,653 $ 24,587 131,593 ========= ======= ========= ======= Primary earnings per common share.............$ .16 $ .18 ========= ========= Fully diluted earnings per common share: Net earnings available for common stock and weighted average number of common shares outstanding..........................$ 20,695 127,939 $ 24,587 130,131 Stock options assumed exercised - net......... - 714 - 1,611 --------- ------- --------- ------- Total net earnings and fully diluted common shares...............................$ 20,695 128,653 $ 24,587 131,742 ========= ======= ========= ======= Fully diluted earnings per common share.......$ .16 $ .18 ========= =========
NINE MONTHS 1994 1993 Earnings Shares Earnings Shares Primary earnings per common share: Net earnings available for common stock and weighted average number of common shares outstanding..........................$ 101,427 128,930 $ 204,264 129,643 Stock options assumed exercised-net........... - 678 - 1,124 --------- ------- --------- ------- Total net earnings and primary common shares..$ 101,427 129,608 $ 204,264 130,767 ========= ======= ========= ======= Primary earnings per common share.............$ .78 $ 1.56 ========= ========= Fully diluted earnings per common share: Net earnings available for common stock and weighted average number of common shares outstanding..........................$ 101,427 128,930 $ 204,264 129,643 Stock options assumed exercised - net......... - 678 - 1,260 --------- ------- --------- ------- Total net earnings and fully diluted common shares...............................$ 101,427 129,608 $ 204,264 130,903 ========= ======= ========= ======= Fully diluted earnings per common share.......$ .78 $ 1.56 ========= =========
EX-12 3 RATIO OF EARNINGS TO FIXED CHARGES BURLINGTON RESOURCES INC. RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12.1 (UNAUDITED)
NINE MONTHS ENDED SEPTEMBER 30, 1994 1993 (In Thousands, Except Ratio Amounts) Earnings: Income from Continuing Operations Before Income Taxes..............................$ 92,207 $ 263,800 Add: Interest and fixed charges....................... 64,440 54,729 Portion of rent under long-term operating leases representative of an interest factor.... 3,400 3,541 --------- --------- Total Earnings Available for Fixed Charges.........$ 160,047 $ 322,070 ========= ========= Fixed Charges: Interest and fixed charges.........................$ 64,440 $ 54,729 Portion of rent under long-term operating leases representative of an interest factor...... 3,400 3,541 Capitalized interest............................... 1,035 2,224 --------- --------- Total Fixed Charges................................$ 68,875 $ 60,494 ========= ========= Ratio of Earnings to Fixed Charges................... 2.32 x 5.32 x ========= =========
EX-27 4 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BURLINGTON RESOURCES INC. CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER 30, 1994, AND THE RELATED CONSOLIDATED STATEMENT OF INCOME FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1994 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 9-MOS DEC-31-1994 JAN-01-1994 SEP-30-1994 4,923 0 173,737 0 34,690 238,752 6,271,409 1,838,346 4,850,929 277,049 1,302,152 1,500 0 0 2,541,357 4,850,929 935,202 935,202 0 780,525 0 0 64,440 92,207 (9,220) 101,427 0 0 0 101,427 .78 .78
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