-----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, KZDaoY2G6iseTp6W5scw4s1XnBmvrOAXS3NJNNyrTQKNYTBOTVP5nNtCpCaI9G5a qH9P6iOswpSLXTsoa+4RCA== 0000277952-97-000005.txt : 19970409 0000277952-97-000005.hdr.sgml : 19970409 ACCESSION NUMBER: 0000277952-97-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970228 FILED AS OF DATE: 19970407 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: 97575930 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 February 28, 1997 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 - Six Months Ended February 28, 1997 and 1996 3 Balance Sheet - February 28, 1997 and August 31, 1996 4 Statement of Cash Flows - Six Months Ended February 28, 1997 and 1996 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 9 SIGNATURES 10 PART I. FINANCIAL INFORMATION Item 1. Financial Statements OIL CITY PETROLEUM, INC. STATEMENT OF OPERATIONS (UNAUDITED) Three Months Ended Six Months Ended Feb. 28, Feb. 28, 1997 1996 1997 1996 Revenues: Oil and Gas Sales $ 13,472 $ 12,085 $ 29,690 $ 23,766 Rental Income 10,935 9,493 20,863 18,638 Interest and Other Income 323 369 647 732 Gain (Loss) on Sale of Assets 100 (175) 100 (175) 24,830 21,772 51,300 42,961 Costs and Expenses: Oil & Gas Operating Expenses 11,322 10,799 24,481 22,191 Rental Expenses 10,406 11,469 14,644 15,897 Depreciation, Depletion & Amort. 4,974 5,274 9,948 10,767 Administrative and General 22,006 24,791 54,131 59,023 Interest Expense- Non-Affiliates 4,087 4,395 8,250 8,848 Interest Expense- Affiliates 22,972 20,907 45,313 41,275 75,767 77,635 156,767 158,001 Net Income or (Loss) $ (50,937) $ (55,863) $(105,467) $(115,040) Net Income or (Loss) Per Share $ (.01) $ (.01) $ (.01) $ (.01) Average Number of Shares Outstanding 14,912,492 14,912,492 14,912,492 14,912,492 SEE NOTES TO FINANCIAL STATEMENTS OIL CITY PETROLEUM, INC. BALANCE SHEET (UNAUDITED) Feb. 28, Aug. 31, ASSETS 1997 1996 Current Assets: Cash $ 9,261 $ 311 Short-term Investments 25,000 25,000 Accounts Receivable 13,971 15,119 Crude Oil Inventory 4,992 4,992 Other Current Assets 737 3,597 Total Current Assets 53,961 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 (722,664) (712,716) Net Property and Equipment 640,400 643,578 Other Assets -- -- Total Assets $ 694,361 $ 692,597 SEE NOTES TO FINANCIAL STATEMENTS OIL CITY PETROLEUM, INC. BALANCE SHEET (UNAUDITED) Feb. 28, Aug. 31, LIABILITIES AND SHAREHOLDERS' EQUITY 1997 1996 Current Liabilities: Accounts Payable and Accrued Expenses $ 9,105 $ 14,670 Current Portion of Long-Term Debt 12,171 12,171 Note and Accrued Interest Payable to Affiliate 1,584,530 1,465,807 Total Current Liabilities 1,605,806 1,492,648 Long-Term Debt Less Current Portion 141,463 147,390 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 (8,312,722) (8,207,255) Total Shareholders' Equity (Deficit) (1,052,908) (947,441) Total Liabilities and Shareholders' Equity $ 694,361 $ 692,597 SEE NOTES TO FINANCIAL STATEMENTS OIL CITY PETROLEUM, INC. STATEMENT OF CASH FLOWS (UNAUDITED) Six Months Ended Feb. 28, 1997 1996 Cash Flows from Operating Activities: Net Loss $(105,467) $(115,040) Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation, Depletion, and Amortization 9,948 10,767 Interest Expense - Affiliates 45,313 41,275 Net (Gain) Loss on Sale of Assets -- 175 Change in Assets and Liabilities: (Increase) Decrease in Receivables 1,148 1,735 (Increase) Decrease in Inventory -- -- (Increase) Decrease in Other Current Assets 2,860 2,726 Increase (Decrease) in Accounts Payable and Accrued Expenses (5,565) (9,165) Total Adjustments 53,704 47,513 Net Cash Used in Operating Activities (51,763) (67,527) Cash Flows from Investing Activities: Decrease (Increase) in Capital Expenditures (6,770) (1,437) Proceeds from Sale of Assets -- 5,090 Net Cash Provided (Used) by Investing Activities (6,770) 3,653 Cash Flows from Financing Activities: Increase in Borrowings from Affiliate 73,410 70,279 Principal Payments on Long-term Debt (5,927) (5,338) Net Cash Provided by Financing Activities 67,483 64,941 Net Increase (Decrease) 8,950 1,067 Cash at Beginning of Year 311 3,964 Cash at End of Period $ 9,261 $ 5,031 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 six-month period ended February 28, 1997 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 $1,605,806 at February 28, 1997 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 February 28, 1997 and 1996 Oil and gas sales of $13,472 for the period ended February 28, 1997 increased $1,387 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 $10,935 increased $1,442 from the same quarter of the prior year due to a higher occupancy rate in the current year. Oil & Gas operating expenses of $11,322 increased $523 from $10,799 experienced in the same quarter of the prior year, due to bulldozer work to improve access roads on one of the leases. Rental expenses of $10,406 decreased $1,063 from the same quarter of the prior year, due to lower utility bills and less interest expense on the building mortgage. Depreciation and depletion expense of $4,974 decreased $300 from $5,274 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 $22,006 decreased $2,785 from that experienced during the same period of the prior year, primarily due to lower fees from consultants. Interest expense to affiliates increased $2,065 from that experienced in the same period of the prior year because the Registrant's debt to affiliates has increased $138,868 since that time. Six Months Ended February 28, 1997 and 1996 Oil and gas sales of $29,690 for the period ended February 28, 1997 increased $5,924 from $23,766 experienced during the same period of the prior year. The decrease is primarily due to increased production from well workovers performed during the prior year. Rental income of $20,863 increased $2,225 from the same period of the prior year due to a higher occupancy rate in the current year. Oil & gas operating expenses of $24,481 increased $2,290 from $22,191 experienced during the same period of the prior year, due to downhole pump repairs performed in an attempt to increase production, and bulldozer work to improve access roads on one of the leases. Rental expenses of $14,644 decreased $1,253 from $15,897 experienced during the same period of the prior year, due to lower utility bills and less interest expense on the building mortgage. Depreciation and depletion expense of $9,948 decreased $819 from $10,767 experienced during the same period 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 $54,131 decreased $4,892 from $59,023 experienced during the same period of the prior year, due to lower fees from consultants. Interest expense to affiliates increased $4,038 from that experienced in the same period of the prior year because the Registrant's debt to affiliates has increased $138,868 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 February 28, 1997: 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: March 26, 1997 s/b Herman E. Nichols, Jr. Herman E. Nichols, Jr. President EX-27 2
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM OIL CITY PETROLEUM, INC.'S SECOND QUARTER 10-Q DATED FEBRUARY 28, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENT. 6-MOS AUG-31-1997 FEB-28-1997 34261 0 13971 0 4992 737 1363064 722664 694361 1605806 0 5692571 0 0 1567243 694361 50553 51300 0 0 103204 0 53563 (105467) 0 (105467) 0 0 0 (105467) (.01) (.01)
-----END PRIVACY-ENHANCED MESSAGE-----