-----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, AwJ7ezy5kX72yp7WvmVDA2usmMzhBKRFuKV9bilT2JA2nG7lLYZ5GlwGLk78b6jP J25A2jg4CWRdbidQXSOJXg== 0000277595-94-000010.txt : 19940520 0000277595-94-000010.hdr.sgml : 19940520 ACCESSION NUMBER: 0000277595-94-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ENERGEN CORP CENTRAL INDEX KEY: 0000277595 STANDARD INDUSTRIAL CLASSIFICATION: 4924 IRS NUMBER: 630757759 STATE OF INCORPORATION: AL FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-07810 FILM NUMBER: 94528199 BUSINESS ADDRESS: STREET 1: 2101 SIXTH AVE N CITY: BIRMINGHAM STATE: AL ZIP: 35203 BUSINESS PHONE: 2053262742 MAIL ADDRESS: STREET 1: 2101 SIXTH AVE N CITY: BIRNINGHAM STATE: AL ZIP: 35203 FORMER COMPANY: FORMER CONFORMED NAME: ALAGASCO INC DATE OF NAME CHANGE: 19851002 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALABAMA GAS CORP CENTRAL INDEX KEY: 0000003146 STANDARD INDUSTRIAL CLASSIFICATION: 4924 IRS NUMBER: 63022000 STATE OF INCORPORATION: AL FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 002-38960 FILM NUMBER: 94528200 BUSINESS ADDRESS: STREET 1: 2101 SIXTH AVE NORTH CITY: BIRMINGHAM STATE: AL ZIP: 35203 BUSINESS PHONE: 2053268100 MAIL ADDRESS: STREET 1: 2101 SIXTH AVE NORTH CITY: BIRMINGHAM STATE: AL ZIP: 35203 10-Q 1 10-Q 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 QUARTER ENDED MARCH 31, 1994 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO Commission IRS File State of Identification Number Registrant Incorporation Number 1-7810 Energen Corporation Alabama 63-0757759 2-38960 Alabama Gas Corporation Alabama 63-0022000 2101 Sixth Avenue North Birmingham, Alabama 35203 Telephone Number 205/326-2700 Alabama Gas Corporation, a wholly-owned subsidiary of Energen Corporation, meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this Form with reduced disclosure format pursuant to General Instruction H(2). Indicate by a check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. YES X NO Indicate the number of shares outstanding of each of the issuers' classes of common stock, as of May 6, 1994: Energen Corporation, $0.01 par value 10,917,355 shares Alabama Gas Corporation, $0.01 par value 1,972,052 shares ENERGEN CORPORATION AND ALABAMA GAS FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 1994 TABLE OF CONTENTS Page PART I: FINANCIAL INFORMATION (Unaudited) Item 1. Financial Statements (a) Consolidated Statements of Income of Energen Corporation 4 (b) Consolidated Balance Sheets of Energen Corporation 5 (c) Consolidated Statements of Cash Flows of Energen Corporation 7 (d) Statements of Income of Alabama Gas Corporation 8 (e) Balance Sheets of Alabama Gas Corporation 9 (f) Statements of Cash Flows of Alabama Gas Corporation 11 (g) Notes of Unaudited Financial Statements 12 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 14 Selected Business Segment Data of Energen Corporation 18 PART II: OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 19 SIGNATURES 20 (This page intentionally left blank.) PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS CONSOLIDATED STATEMENTS OF INCOME Energen Corporation and Subsidiaries (Unaudited)
Three months ended Six months ended March 31, March 31, (in thousands, except share data) 1994 1993 1994 1993 Operating Revenues Natural gas distribution $ 158,268 $ 142,314 $ 237,261 $ 219,180 Oil and gas production activities 6,170 4,973 12,371 9,878 Other 5,561 4,441 10,809 8,707 Intercompany eliminations (1,912) (2,082) (4,435) (4,011) Total operating revenues 168,087 149,646 256,006 233,754 Operating Expenses Cost of gas 93,912 83,080 137,286 126,986 Operations 23,697 21,260 46,840 41,541 Maintenance 2,438 2,569 4,689 4,736 Depreciation, depletion and amortization 6,796 6,216 13,507 12,187 Taxes, other than income taxes 10,874 9,654 17,601 16,071 Total operating expenses 137,717 122,779 219,923 201,521 Operating Income 30,370 26,867 36,083 32,233 Other Income (Expense) Interest expense, net of amounts capitalized (2,823) (2,741) (5,745) (5,333) Dividends on preferred stock of subsidiary - (21) - (42) Other, net 648 587 844 993 Total other income (expense) (2,175) (2,175) (4,901) (4,382) Income Before Income Taxes 28,195 24,692 31,182 27,851 Income taxes 6,003 4,747 6,690 5,236 Net Income $ 22,192 $ 19,945 $ 24,492 $ 22,615 Earnings Per Average Common Share $ 2.03 $ 1.95 $ 2.28 $ 2.22 Dividends Per Common Share $ 0.27 $ 0.26 $ 0.54 $ 0.52 Average Common Shares Outstanding 10,917 10,211 10,750 10,197 The accompanying Notes are an integral part of these statements.
CONSOLIDATED BALANCE SHEETS Energen Corporation and Subsidiaries (Unaudited)
March 31, September 30, (in thousands) 1994 1993 ASSETS Property, Plant and Equipment Utility plant $ 442,504 $ 429,115 Less accumulated depreciation 224,212 215,892 Utility plant, net 218,292 213,223 Oil and gas properties, successful efforts method 87,717 86,077 Less accumulated depreciation, depletion and amortization 38,537 35,150 Oil and gas properties, net 49,180 50,927 Other property, net 8,493 8,947 Total property, plant and equipment, net 275,965 273,097 Current Assets Cash and cash equivalents 38,480 15,008 Accounts receivable, net of allowance for doubtful accounts of $2,128 at March 31, 1994, and $1,927 at September 30, 1993 52,636 36,181 Inventories, at average cost Storage gas 17,954 - Materials and supplies 8,555 8,957 Liquified natural gas in storage 3,341 3,636 Deferred gas costs 7,920 2,966 Deferred income taxes 9,853 4,090 Prepayments and other 2,990 4,034 Total current assets 141,729 74,872 Other Assets Notes receivable 5,632 6,798 Deferred charges and other 11,825 15,918 Total other assets 17,457 22,716 TOTAL ASSETS $ 435,151 $ 370,685 The accompanying Notes are an integral part of these statements.
CONSOLIDATED BALANCE SHEETS Energen Corporation and Subsidiaries (Unaudited)
March 31, September 30, (in thousands) 1994 1993 CAPITAL AND LIABILITIES Capitalization Preferred stock, cumulative, $0.01 par value, 5,000,000 shares authorized $ - $ - Common shareholders' equity Common stock, $0.01 par value; 30,000,000 shares authorized, 10,916,871 shares outstanding at March 31, 1994, and 10,320,317 shares outstanding at September 30, 1993 109 103 Premium on capital stock 81,052 66,368 Capital surplus 2,802 2,802 Retained earnings 89,789 71,040 Total common shareholders' equity 173,752 140,313 Long-term debt 125,792 85,852 Total capitalization 299,544 226,165 Current Liabilities Long-term debt due within one year 4,643 5,043 Notes payable to banks - 40,000 Accounts payable 42,398 27,609 Accrued taxes 18,558 9,656 Customers' deposits 17,842 16,719 Amounts due customers 9,794 5,105 Accrued wages and benefits 9,230 8,054 Other 14,727 13,232 Total current liabilities 117,192 125,418 Deferred Credits and Other Liabilities Deferred income taxes 881 480 Accumulated deferred investment tax credits 4,834 5,077 Other 12,700 13,545 Total deferred credits and other liabilities 18,415 19,102 Commitments and Contingencies - - TOTAL CAPITAL AND LIABILITIES $ 435,151 $ 370,685 The accompanying Notes are an integral part of these statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS Energen Corporation and Subsidiaries (Unaudited)
Six months ended March 31, (in thousands) 1994 1993 Operating Activities Net income $ 24,492 $ 22,615 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion and amortization 13,507 12,187 Deferred income taxes, net (5,643) (2,009) Deferred investment tax credits, net (243) (265) Gain on sale of equity securities (1,375) - Net change in: Accounts receivable (16,455) (20,677) Inventories (17,257) 1,266 Accounts payable 14,789 16,682 Other current assets and liabilities 13,475 (11,295) Other, net 149 731 Net cash provided by operating activities 25,439 19,235 Investing Activities Additions to property, plant and equipment (16,090) (23,139) Proceeds from sale of equity securities 3,305 - Payments on notes receivable 1,073 655 Other, net 1,588 171 Net cash used in investing activities (10,124) (22,313) Financing Activities Payment of dividends on common stock (5,745) (5,305) Issuance of common stock 14,692 981 Reduction of long-term debt and preferred stock of subsidiary (10,460) (4,518) Proceeds from issuance of medium-term notes 49,670 - Net change in short-term debt (40,000) 9,000 Net cash provided by financing activities 8,157 158 Net change in cash and cash equivalents 23,472 (2,920) Cash and cash equivalents at beginning of period 15,008 10,303 Cash and cash equivalents at end of period $ 38,480 $ 7,383 The accompanying Notes are an integral part of these statements.
STATEMENTS OF INCOME Alabama Gas Corporation (Unaudited)
Three months ended Six months ended March 31, March 31, (in thousands) 1994 1993 1994 1993 Operating Revenues $ 158,268 $ 142,314 $ 237,261 $ 219,180 Operating Expenses Cost of gas 94,930 84,352 139,540 129,641 Operations 18,282 16,451 36,530 32,710 Maintenance 2,342 2,458 4,495 4,510 Depreciation 4,441 4,278 8,868 8,540 Income taxes Current 15,119 8,684 15,480 9,044 Deferred, net (5,787) (316) (5,819) (268) Deferred investment tax credits, net (121) (133) (243) (265) Taxes, other than income taxes 10,577 9,333 16,980 15,508 Total operating expenses 139,783 125,107 215,831 199,420 Operating Income 18,485 17,207 21,430 19,760 Other Income Allowance for funds used during construction 111 34 187 51 Other, net 189 104 (19) 287 Total other income 300 138 168 338 Interest Charges Interest on long-term debt 1,659 1,442 3,078 2,965 Other interest expense 438 583 1,136 928 Total interest charges 2,097 2,025 4,214 3,893 Net Income 16,688 15,320 17,384 16,205 Less cash dividends on cumulative preferred stock - 21 - 42 Net Income Available for Common $ 16,688 $ 15,299 $ 17,384 $ 16,163 The accompanying Notes are an integral part of these statements.
BALANCE SHEETS Alabama Gas Corporation (Unaudited)
March 31, September 30, (in thousands) 1994 1993 ASSETS Property, Plant and Equipment Utility plant $ 442,504 $ 429,115 Less accumulated depreciation 224,212 215,892 Utility plant, net 218,292 213,223 Other property, net 174 83 Current Assets Cash and cash equivalents 27,044 480 Accounts receivable Gas 40,403 23,563 Merchandise 1,079 1,256 Other 1,244 1,011 Allowance for doubtful accounts (2,000) (1,800) Inventories, at average cost Storage gas 17,954 - Materials and supplies 5,704 5,851 Liquified natural gas in storage 3,341 3,636 Deferred gas costs 7,920 2,966 Deferred income taxes 8,339 2,587 Prepayments and other 1,969 2,520 Total current assets 112,997 42,070 Deferred Charges and Other Assets 8,730 9,172 TOTAL ASSETS $ 340,193 $ 264,548 The accompanying Notes are an integral part of these statements.
BALANCE SHEETS Alabama Gas Corporation (Unaudited)
March 31, September 30, (in thousands) 1994 1993 CAPITAL AND LIABILITIES Capitalization Common shareholder's equity Common stock, $0.01 par value; 3,000,000 shares authorized, 1,972,052 shares outstanding in 1993 and 1992 $ 20 $ 20 Premium on capital stock 31,682 21,682 Capital surplus 2,802 2,802 Retained earnings 86,525 74,886 Total common shareholder's equity 121,029 99,390 Cumulative preferred stock, $0.01 par value, 120,000 shares authorized, issuable in series - $4.70 Series - - Long-term debt 84,452 43,912 Total capitalization 205,481 143,302 Current Liabilities Long-term debt due within one year 2,793 3,193 Notes payable to banks - 29,000 Accounts payable Other 35,351 18,772 Affiliated companies 8,180 1,252 Accrued taxes 19,506 8,960 Customers' deposits 17,784 16,717 Supplier refunds due customers 806 740 Other amounts due customers 8,988 4,365 Accrued wages and benefits 6,147 5,261 Other 7,225 4,821 Total current liabilities 106,780 93,081 Deferred Credits and Other Liabilities Deferred income taxes 12,630 12,416 Accumulated deferred investment tax credits 4,834 5,077 Regulatory liability 7,344 7,717 Customer advances for construction and other 3,124 2,955 Total deferred credits and other liabilities 27,932 28,165 Commitments and Contingencies - - TOTAL CAPITAL AND LIABILITIES $ 340,193 $ 264,548 The accompanying Notes are an integral part of these statements.
STATEMENTS OF CASH FLOWS Alabama Gas Corporation (Unaudited)
Six months ended March 31, (in thousands) 1994 1993 Operating Activities Net income $ 17,384 $ 16,205 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 8,868 8,540 Deferred income taxes, net (5,819) (268) Deferred investment tax credits (243) (265) Net change in: Accounts receivable (16,783) (19,108) Inventories (17,512) 137 Accounts payable 18,017 15,953 Other current assets and liabilities 15,189 (8,568) Other, net 684 234 Net cash provided by operating activities 19,785 12,860 Investing Activities Additions to property, plant and equipment (13,745) (8,980) Net advances from holding company 87 (119) Other, net (118) 5 Net cash used in investing activities (13,776) (9,094) Financing Activities Payment of dividends on common stock (5,745) (5,305) Payment of dividends on preferred stock - (42) Reduction of long-term debt and preferred stock (9,860) (3,708) Proceeds from issuance of medium-term notes 49,670 - Proceeds from equity infusion from parent 10,000 - Net advances from (to) affiliates 5,490 (6,299) Net change in short-term debt (29,000) 12,000 Net cash provided by (used in) financing activities 20,555 (3,354) Net change in cash 26,564 412 Cash at beginning of period 480 2,394 Cash at end of period $ 27,044 $ 2,806 The accompanying Notes are an integral part of these statements.
NOTES TO UNAUDITED FINANCIAL STATEMENTS Energen Corporation and Alabama Gas Corporation 1. BASIS OF PRESENTATION All adjustments to the unaudited financial statements which are, in the opinion of management, necessary for a fair statement of the results of operations for the interim periods have been recorded. Such adjustments consisted only of normal recurring items. The consolidated financial statements and notes thereto should be read in conjunction with the financial statements and notes for the years ended September 30, 1993, 1992, and 1991 included in the 1993 Annual Report of Energen Corporation (the Company) on Form 10-K. Certain reclassifications were made to conform prior years' financial statements to the current quarter presentation. The Company's primary business is seasonal in character and influenced by weather conditions. Results of operations for the interim periods are not necessarily indicative of the results which may be expected for the fiscal year. 2. REGULATORY As a public utility in the state of Alabama, Alagasco is subject to regulation by the Alabama Public Service Commission (APSC), which has adopted several innovative approaches to rate regulation, including Alabama's Rate Stabilization and Equalization (RSE) rate- setting process. Implemented in 1983 and modified in 1985, 1987, and 1990, RSE replaces the traditional utility rate case with APSC- monitored periodic rate adjustments presently designed to give Alagasco the opportunity to earn an average return on equity (ROE) at its fiscal year-end within a specified range. Under Alagasco's current RSE order, which became effective December 1990, Alagasco's allowed ROE range is 13.15 percent to 13.65 percent. The APSC conducts quarterly reviews to determine, based on Alagasco's budget and fiscal year-to-date performance, whether Alagasco's projected ROE for the fiscal year will be within the allowed range. Reductions in rates can be made quarterly to bring the projected ROE within the allowed range. Increases, however, are permitted only once each fiscal year effective on December 1, and cannot exceed 4 percent of prior-year revenues. RSE limits Alagasco's equity upon which a return is permitted to 60 percent of total capitalization and provides for a cost control measure designed to monitor Alagasco's operations and maintenance (O & M) expense. If increases in O & M expense per customer fall within 1.25 percent above or below the Consumer Price Index for all Urban Customers (index range), no adjustment is required. If, however, increases in O & M expense per customer exceed the index range, three-fourths of the difference is returned to customers. To the extent increases in O & M expense per customer are less than the index range, Alagasco will benefit by one-half of the difference through future rate adjustments. Effective December 15, 1990, the APSC approved a temperature adjustment to customers' monthly bills to mitigate the effect of departures from normal temperature on Alagasco's earnings. The calculation is performed monthly and adjusted on customer's bills in the actual month the weather variation occurs. Under RSE as extended, a $.5 million annual decrease in revenue became effective October 1, 1993, and a $7.2 million annual increase in revenue became effective December 1, 1993. As of April 1, 1994, the Company was within its allowed range; accordingly, no annual adjustment was required. 3. SUPPLEMENTAL CASH FLOW INFORMATION Energen Corporation Six months ended March 31, (in thousands) 1994 1993 Interest paid, net of amounts capitalized $ 5,919 $ 6,411 Income taxes paid $ 3,984 $ 3,646 Noncash investing activities (capitalized depreciation and allowance for funds used during construction) $ 269 $ 140 Noncash financing activities (debt issuance costs) $ 330 $ - Alabama Gas Corporation Six months ended March 31, (in thousands) 1994 1993 Interest paid $ 4,247 $ 4,861 Income taxes paid $ 4,612 $ 3,623 Noncash investing activities (capitalized depreciation and allowance for funds used during construction) $ 269 $ 140 Noncash financing activities (debt issuance costs) $ 330 $ - Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Consolidated net income for the second quarter was $22,192,000 ($2.03 per share), compared with consolidated net income of $19,945,000 ($1.95 per share) for the same period last year. Consolidated net income for the six months was $24,492,000 ($2.28 per share) compared with $22,615,000 ($2.22 per share) for the same period of the prior year. Strong performances by Energen Corporation's two core businesses, Alabama Gas Corporation (Alagasco) and Taurus Exploration, Inc. (Taurus) were responsible for both the quarter and year-to-date increases. The 11 percent increase in the current quarter earnings was attributable primarily to both the utility earning its allowed return on additional equity (resulting from its investment in underground storage working gas), and to Taurus's higher conventional gas production, coalbed methane operating fees, and lower exploration expense. Net income from the Company's other activities rose slightly as a result primarily of increased merchandising operations. The 8 percent increase in year-to-date net income was due primarily to the utility earning its allowed return on additional equity. Higher conventional gas production at Taurus, as well as increased merchandising and propane operations from Energen's other activities, also contributed to the increase. Natural gas revenues increased 11 percent for the quarter and 8 percent for the six-month period. Increases for both periods were due to a combination of the recovery of Gas Supply Realignment (GSR) costs in connection with the implementation of Order 636, and to an 11 percent increase in volumes sold to residential customers, and 6 percent increase year-to-date. Oil and gas revenues increased 24 percent for the quarter primarily due to significantly higher conventional gas production, increased operating fees associated with increased production, and decreased exploration expense. Offsetting these increases to some degree was the effect of decreased oil and gas prices. The average sales price of gas for the current quarter was $1.95 per Mcf compared with $2.03 per Mcf in the prior year. The average sales price of oil for the current quarter was $12.98 per barrel compared with $16.96 per barrel in the prior year. Oil and gas revenues year-to- date increased 25 percent. Similar to the quarter, conventional gas production was the dominant component of the revenue increase; a 32 percent growth in operating fees primarily related to production was offset in part by decreased consulting fees following the conclusion of a major consulting contract and decreased oil prices. The average sales price of gas for the six months ended March 31, 1994, and 1993, was $1.98 per Mcf. The average sales price of oil for the six months ended March 31, 1994, was $14.05 per barrel compared with $17.60 per barrel in the prior year. To hedge its exposure to such price fluctuations on oil and gas production, Taurus periodically enters into futures contracts. Under this program, Taurus has entered into futures contracts for the sale of 4.3 Bcf of its gas production with an average contract price of $1.94, and for the sale of 24,000 barrels of its oil production at an average contract price of $20.30 over the remainder of this fiscal year. Taurus has extended its program into fiscal 1995 for the sale of 3.4 Bcf of its gas production with an average contract price of $2.16. Other revenues for the quarter and year-to-date were 25 percent and 24 percent higher, respectively, due primarily to increased merchandising sales. The 13 percent increase in cost of gas for the quarter and 8 percent increase in cost of gas for the year were due to the recovery of GSA costs and greater volumes sold, partially offset by lower commodity cost of gas. Operations and maintenance expense increased 10 percent in the current quarter and 12 percent for the year. Impacting these expenses for both periods were increased labor and related expenses at Alagasco, and increased operations expenses associated with merchandising operations. Depreciation expense for the quarter and year-to-date increased 9 and 11 percent, respectively, due largely to higher conventional gas production at Taurus and normal plant growth at Alagasco. The Company's expense for taxes other than income taxes primarily reflects various state and local business taxes paid by Alagasco as well as various payroll-related taxes. The state and local business taxes are generally based on gross receipts of Alagasco and fluctuate accordingly. Interest expense for the quarter rose only 3 percent as the effect of the issuance of both $15 million in unsecured notes in the third quarter of the prior year and $50 million unsecured notes in the current year was largely offset by significantly lower average short-term debt outstanding. For the year, interest expense rose 8 percent due to the effects of the debt issuances above, offset by slightly lower average short-term debt outstanding. Other income was virtually unchanged for the quarter. For the year, the variation in other income was due to redemption fees incurred related to the refinancing of long-term debt during the current year. The increase in income tax expense for the quarter and year-to-date was associated with increased pretax income. The Company anticipates effective tax rates to remain lower than statutory rates through the year 2002 as it expects to recognize all section 29 tax credits generated for financial statement purposes. As previously discussed, the Company's business is seasonal in character and influenced by weather conditions. Results of operations for the interim periods are not necessarily indicative of the results that may be expected for the fiscal year. LIQUIDITY AND CAPITAL RESOURCES Three factors were primarily responsible for the $6.2 million increase in cash provided by operations. The recovery of GSR costs, and increases in accrued taxes payable (both reflected in other current assets and liabilities) were largely offset by Alagasco's current year purchase of storage gas. Fluctuations in accounts receivable and payable are generally the result of timing of payments. Net cash provided by investing activities increased $12.2 million over the prior year. The most significant factor contributing to the increase was the current year reduction in capital expenditures. Capital expenditures for the prior year included the Company's investment of approximately $13 million in conventional producing properties following the 1992 sale of nonconventional properties. Offsetting the current year decrease at Taurus was an increase in capital expenditures at Alagasco due in part to the development of a new customer information system. Also contributing to the increase were proceeds of $3.3 million resulting from the sale of equity securities. The increase in net cash provided by financing activities of $8 million is attributable to several occurrences in the current year. Proceeds from the issuance of 550,000 shares of Energen common stock in November of 1993 totaled $13.5 million and were used to help fund the purchase of storage gas. Alagasco also issued $50 million of medium-term notes which offered investors a combination of interest rates and investment periods ranging from 5.4 percent to 7.2 percent for notes redeemable December 1, 1998, to December 15, 2023. Alagasco used proceeds from these notes to fund the balance of the storage investment, redeem its 8.75 percent debentures, reduce its short-term debt outstanding, and to fund additional capital needs. Energen has short-term credit facilities totaling $110 million available for working capital needs, with $29 million outstanding at March 31, 1993. CAPITAL EXPENDITURES: Capital and exploration expenditures could approximate $52 million in 1994, excluding municipal gas system acquisitions, and primarily will be used to fund normal distribution system expansion and the development of a new customer information system at Alagasco, and oil and gas development activities. The Company anticipates funding these capital expenditures through internally generated capital and the utilization of short-term credit facilities. In addition to the capital expenditures, the Company will maintain an investment in storage working gas which is anticipated to average $26.0 million. (This page intentionally left blank.) SELECTED BUSINESS SEGMENT DATA Energen Corporation
Three months ended Six months ended March 31, March 31, 1994 1993 1994 1993 Natural Gas Distribution Operating revenues (in thousands) Residential $ 110,586 $ 96,338 $ 162,184 $ 146,775 Commercial and industrial - small 39,523 35,772 58,635 55,075 Commercial and industrial - large 710 964 733 1,240 Transportation 8,248 8,089 16,056 15,367 Other (799) 1,151 (347) 723 Total $ 158,268 $ 142,314 $ 237,261 $ 219,180 Volumes sold and transported (thousands of Mcf) Residential 16,841 15,155 23,773 22,426 Commercial and industrial - small 6,429 6,118 9,502 9,427 Commercial and industrial - large 86 188 91 266 Transportation 13,747 13,454 26,915 26,440 Total 37,103 34,915 60,281 58,559 Other data (in thousands) Depreciation and amortization $ 4,441 $ 4,278 $ 8,868 $ 8,540 Capital expenditures $ 8,678 $ 5,631 $ 14,014 $ 9,188 Operating income $ 27,696 $ 25,442 $ 30,848 $ 28,271 Oil and Gas Exploration and Production Operating revenues (in thousands) Natural gas $ 4,136 $ 3,028 $ 8,155 $ 5,405 Oil 649 916 1,461 1,707 Other 1,385 1,029 2,755 2,766 Total $ 6,170 $ 4,973 $ 12,371 $ 9,878 Sales volume - natural gas (thousands of Mcf) 2,126 1,492 4,117 2,733 Sales volume - oil (thousands of barrels) 50 54 104 97 Average sales price - natural gas (per Mcf) $ 1.95 $ 2.03 $ 1.98 $ 1.98 Average sales price - oil (per barrel) $ 12.98 $ 16.96 $ 14.05 $ 17.60 Other data (in thousands) Depreciation, depletion and amortization $ 2,090 $ 1,655 $ 4,045 $ 3,083 Capital expenditures $ 315 $ 1,087 $ 2,148 $ 13,890 Exploration expenditures $ 139 $ 468 $ 194 $ 564 Operating income $ 1,913 $ 905 $ 4,011 $ 3,213 Other Businesses (in thousands) Operating revenues $ 5,561 $ 4,441 $ 10,809 $ 8,707 Depreciation and amortization $ 265 $ 283 $ 594 $ 564 Capital expenditures $ 51 $ 189 $ 197 $ 271 Operating income $ 1,071 $ 850 $ 1,845 $ 1,392 Eliminations and Corporate Expenses (in thousands) Operating loss $ (310) $ (330) $ (621) $ (643)
PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a. Exhibits None. b. Reports on Form 8-K No reports on Form 8-K were filed for the three months ended March 31, 1994. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ENERGEN CORPORATION ALABAMA GAS CORPORATION May 13, 1994 By/s/ Rex J. Lysinger Date Rex J. Lysinger Chairman of the Board and Chief Executive Officer May 13, 1994 By/s/ G. C. Ketcham Date G. C. Ketcham Executive Vice President, Chief Financial Officer and Treasurer May 13, 1994 By/s/ J. T. McManus Date J. T. McManus Vice President-Finance and Corporate Development of Energen and Vice President Finance and Planning of Alagasco -----END PRIVACY-ENHANCED MESSAGE-----