-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IyBp5q75DBKLgRbvwrEa+dHPUv120JuRHVF+3eqjTYmfIM8FlR+ovaROjeY0UHKK EPrEyIuxCuoqlTKQqIxe1Q== 0000277952-97-000001.txt : 19970122 0000277952-97-000001.hdr.sgml : 19970122 ACCESSION NUMBER: 0000277952-97-000001 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19961130 FILED AS OF DATE: 19970121 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: OIL CITY PETROLEUM INC CENTRAL INDEX KEY: 0000277952 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 751614001 STATE OF INCORPORATION: TX FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-09098 FILM NUMBER: 97508035 BUSINESS ADDRESS: STREET 1: 5579 S LEWIS CITY: TULSA STATE: OK ZIP: 74105 BUSINESS PHONE: 9187490483 MAIL ADDRESS: STREET 1: 5579 S LEWIS CITY: TULSA STATE: OK ZIP: 74105 10-Q 1 FORM-10Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 Quarter Ended November 30, 1996 Commission File Number 0-9098 OIL CITY PETROLEUM, INC. (Exact name of Registrant as specified in its Charter) Texas 75-1614001 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 5579 South Lewis, Tulsa, Oklahoma 74105 (Address of principal executive offices) (Zip Code) (918) 749-0483 (Registrant's telephone number, including area code) Indicate by check mark whether the Registrant (1) has filed all reports re- quired to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for at least the past 90 days. Yes X No The Registrant had 14,912,492 shares of common stock, no par value outstanding as of the close of the period covered by this report. OIL CITY PETROLEUM, INC. INDEX Page PART I. FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) Statement of Operations - Three Months Ended November 30, 1996 and 1995 3 Balance Sheet - November 30, 1996 and August 31, 1996 4 Statement of Cash Flows - Three Months Ended November 30, 1996 and 1995 6 Notes to Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 7 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 8 SIGNATURES 9 PART I. FINANCIAL INFORMATION Item 1. Financial Statements OIL CITY PETROLEUM, INC. STATEMENT OF OPERATIONS (UNAUDITED) Three Months Ended November 30, 1996 1995 Revenues: Oil and Gas Sales $ 16,217 $ 11,681 Rental Income 9,929 9,145 Interest and Other Income 324 363 Gain (Loss) on Sale of Assets -- -- 26,470 21,189 Costs and Expenses: Oil & Gas Operating Expenses 13,160 11,392 Rental Expenses 4,237 4,429 Depreciation, Depletion & Amortization 4,974 5,493 Administrative and General 32,125 34,232 Interest Expense - Non-affiliates 4,163 4,453 Interest Expense - Affiliates 22,340 20,368 80,999 80,367 Net Income or (Loss) $ (54,529) $ (59,178) Net Income or (Loss) Per Share $ (.01) $ (.01) Average Number of Shares Outstanding 14,912,492 14,912,492 SEE NOTES TO FINANCIAL STATEMENTS OIL CITY PETROLEUM, INC. BALANCE SHEET (UNAUDITED) Nov. 30, Aug. 31, ASSETS 1996 1996 Current Assets: Cash $ 5,442 $ 311 Short-term Investments 25,000 25,000 Accounts Receivable 14,665 15,119 Crude Oil Inventory 4,992 4,992 Other Current Assets 4,974 3,597 Total Current Assets 55,073 49,019 Property and Equipment, at Cost: Oil and Gas Properties, Successful Efforts Method 1,094,018 1,094,018 Field Equipment 7,945 7,945 Building, Land and Office Equipment 261,101 254,331 Total Property and Equipment, at Cost 1,363,064 1,356,294 Less Accumulated Depreciation, Depletion, and Amortization (717,690) (712,716) Net Property and Equipment 645,374 643,578 Other Assets -- -- Total Assets $ 700,447 $ 692,597 SEE NOTES TO FINANCIAL STATEMENTS OIL CITY PETROLEUM, INC. BALANCE SHEET (UNAUDITED) Nov. 30, Aug. 31, LIABILITIES AND SHAREHOLDERS' EQUITY 1996 1996 Current Liabilities: Accounts Payable and Accrued Expenses $ 20,795 $ 14,670 Current Portion of Long-Term Debt 12,171 12,171 Note and Accrued Interest Payable to Affiliate 1,524,986 1,465,807 Total Current Liabilities 1,557,952 1,492,648 Long-Term Debt Less Current Portion 144,465 147,390 Shareholders' Equity: Common Stock, No Par Value - Authorized 30,000,000 Shares, Issued and Outstanding 14,912,492 Shares 5,692,571 5,692,571 Additional Paid-in Capital 1,567,243 1,567,243 Accumulated Deficit (8,261,784) (8,207,255) Total Shareholders' Equity (Deficit) (1,001,970) (947,441) Total Liabilities and Shareholders' Equity $ 700,447 $ 692,597 SEE NOTES TO FINANCIAL STATEMENTS OIL CITY PETROLEUM, INC. STATEMENT OF CASH FLOWS (UNAUDITED) Three Months Ended Nov. 30, 1996 1995 Cash Flows from Operating Activities: Net Loss $ (54,529) $ (59,178) Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation, Depletion, and Amortization 4,974 5,493 Interest Expense - Affiliates 22,340 20,368 Net (Gain) Loss on Sale of Assets -- -- Change in Assets and Liabilities: (Increase) Decrease in Receivables 454 956 (Increase) Decrease in Inventory -- -- (Increase) Decrease in Other Current Assets (1,377) (1,415) Increase (Decrease) in Accounts Payable and Accrued Expenses 6,125 (1,845) Total Adjustments 32,516 23,557 Net Cash Used in Operating Activities (22,013) (35,621) Cash Flows from Investing Activities: Decrease (Increase) in Capital Expenditures (6,770) -- Proceeds from Sale of Assets -- -- Net Cash Provided (Used) by Investing Activities (6,770) -- Cash Flows from Financing Activities: Increase in Borrowings from Affiliate 36,839 37,734 Principal Payments on Long-term Debt (2,925) (2,634) Net Cash Provided by Financing Activities 33,914 35,100 Net Increase (Decrease) 5,131 (521) Cash at Beginning of Year 311 3,964 Cash at End of Period $ 5,442 $ 3,443 SEE NOTES TO FINANCIAL STATEMENTS NOTES TO FINANCIAL STATEMENTS (UNAUDITED) BASIS OF PRESENTATION The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of the management, all adjustments considered necessary for a fair presentation have been included. Operating results for the three-month period ended November 30, 1996 are not necessarily indicative of the results that may be expected for the year ended August 31, 1997. For further information, refer to the financial statements and notes thereto included in the Registrant's annual report on Form 10-K for the year ended August 31, 1996. NET LOSS PER SHARE Loss per share is computed based on the net loss for the period, divided by the weighted average number of common shares outstanding during each period. Common equivalent shares are not included in the computation because of their anti-dilutive effect. LONG-TERM DEBT Since 1987, cash advances have been made to the Registrant by National Oil & Gas, Inc., an affiliated entity, in order to finance working capital deficits. The terms of the notes representing such cash advances are 6% to 9% interest with all principal and accrued interest due on demand. Outstanding principal and accrued interest of $1,524,986 at November 30, 1996 are classified on the balance sheet as a current liability as these notes are payable on demand. National Oil & Gas, Inc. is an affiliated company controlled by Mr. William G. Moser, Chairman of the Board of the Registrant. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations FINANCIAL CONDITION In view of the continuing volatile conditions in the oil and gas industry and the significant sales of oil and gas properties in recent years, the Registrant anticipates that cash flow from operations will not be sufficient to provide for the payment of its indebtedness, necessitating the renewal or refinancing of such indebtedness at maturity. No assurance can be given that the Registrant will be able to renew or refinance such indebtedness or that additional cash infusions will be available. RESULTS OF OPERATIONS Three Months Ended November 30, 1996 and 1995 Oil and gas sales of $16,217 for the period ended November 30, 1996 increased $4,536 from the same quarter of the prior year. This increase is primarily due to increased production from well workovers performed during the prior year. Rental income of $9,929 increased $784 from the same quarter of the prior year due to a higher occupancy rate in the current year. Oil & Gas operating expenses of $13,160 increased $1,768 from $11,392 experienced in the same quarter of the prior year, due to downhole pump repairs performed in an attempt to increase production. Rental expenses of $4,237 decreased $192 from the same quarter of the prior year, due to less interest expense on the building mortgage. Depreciation and depletion expense of $4,974 decreased $519 from $5,493 experienced during the same quarter of the prior year due to lower depletion rates on oil leases, and due to the sale of a depreciating storage building in Louisiana. Administrative and general expense of $32,125 decreased $2,107 from that experienced during the same period of the prior year, primarily due to lower fees for accounting services. Interest expense to affiliates increased $1,972 from that experienced in the same period of the prior year because the Registrant's debt to affiliates has increased $134,840 since that time. PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits required by Item 601 of Regulation S-X: None. (b) Reports on Form 8-K during the three months ended November 30, 1996: None. SIGNATURE 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. OIL CITY PETROLEUM, INC. Date: January 14, 1997 Herman E. Nichols, Jr. Herman E. Nichols, Jr. President -----END PRIVACY-ENHANCED MESSAGE-----