0000912057-95-006419.txt : 19950821 0000912057-95-006419.hdr.sgml : 19950821 ACCESSION NUMBER: 0000912057-95-006419 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950814 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: WILSHIRE OIL CO OF TEXAS CENTRAL INDEX KEY: 0000107454 STANDARD INDUSTRIAL CLASSIFICATION: 1311 IRS NUMBER: 840513668 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-04673 FILM NUMBER: 95562393 BUSINESS ADDRESS: STREET 1: 921 BERGEN AVE CITY: JERSEY CITY STATE: NJ ZIP: 07306-4204 BUSINESS PHONE: 2014202796 MAIL ADDRESS: STREET 1: 921 BERGEN AVENUE STREET 2: 921 BERGEN AVENUE CITY: JERSEY CITY STATE: NJ ZIP: 07306 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For quarter ended June 30, 1995 Commission file number 1-467 -------------------------------- WILSHIRE OIL COMPANY OF TEXAS -------------------------------------------------------------------------------- (Exact name of registrants as specified in its charter) Delaware 84-0513668 -------------------------------------------------------------------------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 921 Bergen Avenue - Jersey City, New Jersey 07306-4204 -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number - including area code (201) 420-2796 -------------------------------------------------------------------------------- NO CHANGE -------------------------------------------------------------------------------- Former name, former address and former fiscal year, if changed since last reports. 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 close of the period by this report. Common Stock $1 Par Value -----9,605,505 WILSHIRE OIL COMPANY OF TEXAS INDEX Page No. -------- Part I Financial Information Financial Information: 1 Consolidated Balance Sheets - June 30, 1995 and December 31, 1994 Consolidated Statements of Operations - 2 Six months ended June 30, 1995 and 1994 Consolidated Statements of Operations - 3 Three months ended June 30, 1995 and 1994 Consolidated Statements of Cash Flows - 4 Six months ended June 30, 1995 and 1994 Notes to Consolidated Financial Statements 5 Management's Discussion and Analysis 6,7 & 8 of Financial Condition and Results of Operations Part II Other Information 9 WILSHIRE OIL COMPANY OF TEXAS AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (000's Omitted, Except Share Data) (Unaudited)
ASSETS June 30, December 31, 1995 1994 ------- -------- CURRENT ASSETS: Cash and cash equivalents $ 1,033 $ 907 Accounts receivable 1,149 934 Marketable securities, stated at market value in 1995 and 1994 30,009 29,989 Prepaid expenses and other current assets 611 450 -------- -------- Total current assets 32,802 32,280 -------- -------- INVESTMENT IN PREFERRED STOCK OF THE TRUST COMPANY OF NEW JERSEY 6,000 6,000 -------- -------- PROPERTY AND EQUIPMENT Oil and gas properties, using the full cost method of accounting 129,099 127,880 Real estate properties 35,940 35,523 Other property and equipment 395 391 -------- -------- 165,434 163,794 Less - Accumulated depreciation, depletion and amortization 101,112 98,876 -------- -------- 64,322 64,918 -------- -------- $103,124 $103,198 -------- -------- -------- -------- LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of long-term debt $ 2,600 $ 2,484 Accounts payable 2,847 2,853 Accrued liabilities 428 626 -------- -------- Total current liabilities 5,875 5,963 -------- -------- LONG - TERM DEBT, less current portion 48,885 50,160 -------- -------- DEFERRED INCOME TAXES 18,957 18,636 -------- -------- -------- -------- COMMITMENTS AND CONTINGENCIES (Note 3) SHAREHOLDERS' EQUITY Common stock, $1 par value, 15,000,000 shares authorized; issued 10,013,544 and 10,013,544 shares in 1995 and 1994 10,014 10,014 Capital in excess of par value 10,102 10,399 Unrealized gain on marketable securities ($17,471 in 1995 and $18,487 in 1994), net of deferred income taxes 9,633 10,168 Retained earnings 4,792 2,822 -------- -------- 34,541 33,403 Less - Treasury stock, 408,039 and 341,818 shares in 1995 and 1994, at cost 2,714 2,290 Cumulative foreign currency translation adjustment 2,420 2,674 -------- -------- 29,407 28,439 -------- -------- $103,124 $103,198 -------- -------- -------- --------
1 WILSHIRE OIL COMPANY OF TEXAS AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (000's Omitted, Except Share Data) (Unaudited)
FOR THE SIX MONTHS ENDED ------------------------- June 30, June 30, 1995 1994 ------- -------- REVENUES Oil & Gas $ 3,013 $ 4,021 Real Estate 4,239 3,785 ----- --------- Total Revenues 7,252 7,806 COSTS AND EXPENSES Oil and Gas Production Expenses 1,362 1,331 Real Estate Operating Expenses 2,372 2,074 Depreciation, depletion and amortization 2,077 2,413 General and Administrative 689 712 ------- ------- Total Costs and Expenses 6,500 6,530 -------- ------- Income from Operations 752 1,276 OTHER INCOME 328 181 GAIN ON SALES OF MARKETABLE SECURITIES (Note 2) 4,900 3,811 INTEREST EXPENSE ( 2,111) (1,546) ------- ------- Income before provision for income taxes 3,869 3,722 -------- -------- PROVISION FOR INCOME TAXES Federal Current 519 672 Deferred 638 401 Foreign Current 20 46 Deferred 58 34 ---------- ------- 1,235 1,153 --------- --------- Net income $ 2,634 $ 2,569 --------- --------- AVERAGE NUMBER OF SHARES OF COMMON STOCK OUTSTANDING: 9,651,016 9,991,514 --------- --------- INCOME PER COMMON SHARE $ .27 $ .26 --------- ---------
2 WILSHIRE OIL COMPANY OF TEXAS AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (000's Omitted, Except Share Data) (Unaudited)
FOR THE THREE MONTHS ENDED -------------------------- June 30, June 30, 1995 1994 ------- -------- REVENUES Oil & Gas $ 1,378 $ 2,179 Real Estate 2,155 2,014 --------- ----------- Total Revenues 3,533 4,193 COSTS AND EXPENSES Oil and Gas Production Expenses 676 601 Real Estate Operating Expenses 1,156 1,102 Depreciation, depletion and amortization 1,130 1,352 General and Administrative 433 313 --------- --------- Total Costs and Expenses 3,395 3,368 --------- --------- Income from Operations 138 825 OTHER INCOME 168 97 GAIN ON SALES OF MARKETABLE SECURITIES (Note 2) 2,698 1,709 INTEREST EXPENSE (1.051) (854) ------- --------- Income before provision for income taxes 1,953 1,777 --------- --------- PROVISION FOR INCOME TAXES Federal Current ( 6 ) 392 Deferred 638 76 Foreign Current 33 ( 28) Deferred ( 16) 74 --------- --------- 649 514 --------- --------- Net income 1,304 $ 1,263 --------- --------- AVERAGE NUMBER OF SHARES OF COMMON STOCK OUTSTANDING: 9,637,942 9,979,740 --------- --------- INCOME PER COMMON SHARE $ .14 $ .13 ---------- ---------
3 WILSHIRE OIL COMPANY OF TEXAS AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (000's Omitted) (Unaudited)
For The Six Months Ended -------------------------- June 30, June 30, 1995 1994 ------- -------- CASH FLOWS FROM OPERATING ACTIVITIES Net Income $ 2,634 $ 2,569 Adjustments to reconcile net income to net cash provided by operating activities - Depreciation, depletion and amortization 2,077 2,413 Deferred income tax provision 696 435 Amortization (adjustment) of deferred and unearned compensation in connection with non-qualified stock option plan, net (296) 92 Gain on sales of marketable securities (4,900) (3,811) Foreign currency transactions - - Changes in operating assets and liabilities - (Increase) decrease in receivables ( 215 ) (759) (Increase) in prepaid expenses and other current assets (161) (32) Increase (decrease) in income taxes payable (364) 717 Increase (decrease) in accounts payable, accrued and other liabilities 525 (283) ------- ------- Net cash provided by (used in) operating activities $ ( 4 ) $ 1,341 ------- ------- CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures, net ( 1,415) (12,235) Purchase of marketable securities ( 1,918) ( 2,584) Purchase of Preferred Stock - ( 3,000) Proceeds from sales of marketable securities 5,044 4,414 ------- ------- Net cash provided by (used in) investing activities $ 1,711 ($13,405) ------- ------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of long term debt - 22,804 Principal payment of long term debt ( 1,159) (10,620) Purchase of treasury stock ( 425) ( 538) Exercise of stock options - - Other - - ------- ------- Net cash provided by (used in) financing activities ($ 1,584) $ 11,646 ------- ------- EFFECT OF EXCHANGE RATE CHANGES ON CASH 3 35 ------- ------- Net increase (decrease) in cash and cash equivalents 126 (383) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 907 1,566 ------- ------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,033 $ 1,183 ------- ------- SUPPLEMENTAL DISCLOSURES TO THE STATEMENTS OF CASH FLOWS: Cash paid during the period for - Interest, net of amounts capitalized $ 1,982 $ 1,437 Income taxes, net 221 364 ------- -------
4 WILSHIRE OIL COMPANY OF TEXAS NOTES TO CONSOLIDATED FINANCIAL STATEMENTS June 30, 1995 (Unaudited) 1. FINANCIAL STATEMENTS The condensed financial statements included herein have been prepared by the Registrant, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Registrant believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these condensed financial statements be read in conjunction with the financial statements and the notes thereto included in the Company's latest annual report on Form 10-K This condensed financial information reflects, in the opinion of management, all adjustments necessary to present fairly the results for the interim periods. The results of operations for such interim periods are not necessarily indicative of the results for the full year. 2. GAIN ON SALES OF MARKETABLE SECURITIES The Company realized gains from the sales of marketable securities of $4,900,000 and $3,811,000 for the six months ended June 30, 1995 and 1994, respectively, and $2,698,000 and $1,709,000 for the three months ended June 30, 1995 and 1994, respectively . 3. COMMITMENTS AND CONTINGENCIES Federal income tax returns of the Company and its subsidiaries for the years 1975 through 1983 are under review by the Internal Revenue Service. The Company believes that final settlement of its Federal tax liability for those years will not have a significant effect on its consolidated financial position or results of operations. 5 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Net income for the six months ended June 30 increased from $2,569,000 in 1994 to $2,634,000 in 1995. Net income for the quarter ended June 30 increased from $1,263,000 in 1994 to $1,304,000 in 1995. Oil and gas revenues were $3,013,000 in the first half of 1995 as compared with $4,021,000 in 1994. This decrease was due to production declines from period to period. Real estate revenues increased from $3,785,000 in the first half of 1994 to $4,239,000 in 1995. This increase was principally attributable to the operations of investment real estate properties acquired in 1994 as well as generally higher rents and occupancy. Oil and gas production expense was comparable from period to period. Oil and gas production expense was $1,331,000 in the first half of 1994 and $1,362,000 in 1995. Real estate operating expenses increased in the first half of 1995 over 1994 principally due to the newly acquired properties in 1994. Depreciation, depletion, and amortization expense decreased in the first half of 1995 compared with 1994 principally as a result of the increase in the estimated value of the Company's oil and gas reserves. Gain on sales of marketable securities was $4,900,000 in 1995 as compared with $3,811,000 in 1994.. Interest expense increased from $1,546,000 in the first half of 1994 to $2,111,000 in 1995 due to the addition of $8,704,000 of new financing related to the acquisition of real estate properties in 1994 as well as higher interest rates in general in 1995. The provision for income taxes includes Federal and Canadian taxes. Differences between the effective tax rate and the statutory income tax rates are due to foreign resource tax credits in Canada and the dividend exclusion in the United States. ACCOUNTING FOR INCOME TAXES Statement of Financial Accounting Standard No. 109- "Accounting for Income Taxes" became effective for the Company beginning in the first quarter of 1993. SFAS 109 requires, among other things, an asset and liability approach to accounting for income taxes. SFAS 109 did not have a material impact on the Company's consolidated financial statements. 6 ACCOUNTING FOR CERTAIN INVESTMENTS IN DEBT AND EQUITY SECURITIES On December 31, 1994 the Company adopted Statement of Financial Accounting Standards No. 115 "Accounting for Certain Investments in Debt and Equity Securities" (SFAS 115). The investments of the Company are principally equity securities, held for indefinite periods of time. These securities are carried at fair value and the difference between cost and fair value is charged/credited directly to shareholders' equity net of income taxes. As of June 30, 1995, the gross unrealized gain on marketable securities was $17.5 million. This amount, net of related deferred income taxes of $7.9 million, is included as a credit to shareholders' equity in the Company's June 30, 1995 consolidated balance sheet. LIQUIDITY AND CAPITAL RESOURCES At June 30, 1995 the Company had approximately $12.5 million in marketable securities at cost, with a market value of approximately $30 million. The current ratio at June 30, 1995 was 5.6 to 1 on a market basis, which management considers adequate for the Company's current business. The Company's working capital was approximately $27 million at June 30, 1995. The Company anticipates that cash provided by operating activities and investing activities, will be sufficient to meet its capital requirements to acquire oil and gas properties and to drill and evaluate these and other oil and gas properties presently held by the Company. The level of oil and gas capital expenditures will vary in future periods depending on market conditions, including the price of oil and the demand for natural gas, and other related factors. As the Company has no material long-term commitments with respect to its oil and gas capital expenditure plans, the Company has a significant degree of flexibility to adjust the level of its expenditures as circumstances warrant. The Company plans to actively continue its exploration and production activities as well as search for the acquisition of oil and gas producing properties and of companies with desirable oil and gas producing properties. There can be no assurance that the Company will in fact locate any such acquisitions. The Company will explore other real estate acquisitions as they arise. The timing of any such acquisition will depend on, among other things, economic conditions and the favorable evaluation of specific opportunities presented to the Company. Accordingly, while the Company anticipates that it will actively explore real estate acquisition opportunities, no assurance can be given that any such acquisition will occur. 7 Net cash provided by (used in) operating activities was $(4,000) and $1,341,000 in the first six months of 1995 and 1994, respectively. The changes principally relate to changes in operating assets and liablilities. Net cash provided by (used in) investing activities was $1,711,000 and $(13,405,000) in the first six months of 1995 and 1994, respectively. The Company acquired $10.2 million of real estate properties during the first half of 1994. Additionally, the Company acquired $3 million of preferred stock during the first half of 1994. Net cash provided by (used in) financing activities was $(1,584,000) and $11,646,000 in the first half of 1995 and 1994, respectively. The variation principally relates to the issuance of long-term debt in connection with purchases of real estate properties during 1994. The Company believes it has adequate capital resources to fund operations for the foreseeable future. 8 PART II - OTHER INFORMATION ITEM 1, 2, 3, 4, 5 - NOT APPLICABLE ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K No Form 8-K was filed during the quarter ended June 30, 1995. 9 SIGNATURES Pursuant to the requirements 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. WILSHIRE OIL COMPANY OF TEXAS ---------------------------------- (Registrant) Date: AUGUST 12, 1995 /s/Sherry Wilzig Izak --------------- ----------------------------------- By: Sherry Wilzig Izak Chairman of the Board and Chief Executive Officer (Duly Authorized Officer and Chief Financial Officer) SIGNATURES Pursuant to the requirements 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. WILSHIRE OIL COMPANY OF TEXAS ---------------------------------- (Registrant) Date: AUGUST 12, 1995 --------------- ----------------------------------- By: Sherry Wilzig Izak Chairman of the Board and Chief Executive Officer (Duly Authorized Officer and Chief Financial Officer) EX-27 2 EXHIBIT 27
5 6-MOS DEC-31-1994 JAN-01-1995 JUN-30-1995 1,033,000 30,009,000 1,149,000 0 0 32,802,000 165,434,000 101,112,000 103,124,000 5,875,000 0 10,014,000 0 0 19,393,000 103,124,000 3,013,000 7,252,000 1,362,000 6,500,000 0 0 2,111,000 3,869,000 1,235,000 2,634,000 0 0 0 2,634,000 .27 .27