-----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, NxB2Tnv6ZhlqI1vJCLFP+eQK7Bts/29TTq0R43RQ61iz8pG8aK34Yag5/EieG94N gAS/5cXhjsSOK1vw+cXR1A== 0000950134-01-508574.txt : 20020410 0000950134-01-508574.hdr.sgml : 20020410 ACCESSION NUMBER: 0000950134-01-508574 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010930 FILED AS OF DATE: 20011114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MARINE PETROLEUM TRUST CENTRAL INDEX KEY: 0000062362 STANDARD INDUSTRIAL CLASSIFICATION: OIL ROYALTY TRADERS [6792] IRS NUMBER: 756008017 STATE OF INCORPORATION: TX FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-08565 FILM NUMBER: 1788602 BUSINESS ADDRESS: STREET 1: NATIONSBANK OF TEXAS N A STREET 2: P O BOX 831402 CITY: DALLAS STATE: TX ZIP: 75283-1402 BUSINESS PHONE: 2145081796 MAIL ADDRESS: STREET 1: P O BOX 831402 CITY: DALLAS STATE: TX ZIP: 75283-1402 10-Q 1 d92276e10-q.txt FORM 10-Q FOR QUARTER ENDED SEPTEMBER 30, 2001 ================================================================================ 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, 2001 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition period from ________ to ________ . COMMISSION FILE NUMBER 0-8565 MARINE PETROLEUM TRUST (Exact name of registrant as specified in its charter) TEXAS 75-6008017 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) BANK OF AMERICA, N.A. 75283-0241 P.O. BOX 830241, DALLAS, TEXAS (Zip Code) (Address of principal executive offices) Registrant's telephone number, including area code (800) 985-0794 None (Former name, former address and former fiscal year if changed since last report) ---------- 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 number of units of beneficial interest outstanding as of the latest practicable date. Title of Each Class of Units Number of Units of Beneficial Interest of Beneficial Interest September 30, 2001 ---------------------------- -------------------------------------- UNITS OF BENEFICIAL INTEREST 2,000,000 ================================================================================ MARINE PETROLEUM TRUST INDEX
PAGE NUMBER ------ PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)..................................................................................... 2 Condensed Consolidated Balance Sheets September 30, 2001 and June 30, 2001................................................... 2 Condensed Consolidated Statements of Income for the Three Months Ended September 30, 2001 and 2000........................... 3 Condensed Consolidated Statements of Cash Flows for the Three Months Ended September 30, 2001 and 2000....................... 4 Notes to Condensed Consolidated Financial Statements......................................................................... 5 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS................................ 6 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK........................................................... 8 PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K..................................................................................... 9 Signatures................................................................................................................... 10
1 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS MARINE PETROLEUM TRUST AND SUBSIDIARY CONDENSED CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2001 AND JUNE 30, 2001 (UNAUDITED)
SEPTEMBER 30, JUNE 30, 2001 2001 -------------- -------------- ASSETS Current Assets: Cash and cash equivalents ........................................ $ 2,053,507 $ 2,515,239 Oil and gas royalties receivable ................................. 571,249 854,229 Receivable from affiliate ........................................ 100,838 165,216 -------------- -------------- Total current assets .......................................... $ 2,725,594 $ 3,534,684 -------------- -------------- Investment in affiliate .............................................. 323,601 338,788 Office equipment, at cost less accumulated depreciation .............. 2,400 555 Producing oil and gas properties ..................................... 7 7 -------------- -------------- $ 3,051,602 $ 3,874,034 ============== ============== LIABILITY AND TRUST EQUITY Current Liability - Income taxes payable ............................. $ 15,773 $ 18,343 -------------- -------------- Trust Equity: Corpus - authorized 2,000,000 units of beneficial interest, issued 2,000,000 units at nominal value ........................ 8 8 Undistributed income ............................................. 3,035,821 3,855,683 -------------- -------------- Total trust equity ............................................. 3,035,829 3,855,691 -------------- -------------- $ 3,051,602 $ 3,874,034 ============== ==============
See accompanying notes to condensed consolidated financial statements. 2 MARINE PETROLEUM TRUST AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENT OF INCOME FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000 (UNAUDITED)
THREE MONTHS ------------------------------- 2001 2000 -------------- -------------- Income: Oil and gas royalties ........................ $ 1,393,790 $ 1,694,404 Equity in earnings of affiliate .............. 77,479 201,434 Interest income .............................. 23,524 27,001 -------------- -------------- Total income ........................... 1,494,793 1,922,839 -------------- -------------- General and administrative expenses .............. 44,011 44,140 -------------- -------------- Income before federal income taxes ........... 1,450,782 1,878,699 Federal income taxes of subsidiary ............... 2,430 5,400 -------------- -------------- Net income ................................... 1,448,352 1,873,299 Undistributed income at beginning of year ........ 3,855,683 2,559,993 -------------- -------------- 5,304,035 4,433,292 Distributions to unitholders ..................... 2,268,214 1,245,558 -------------- -------------- Undistributed income at end of period ............ $ 3,035,821 $ 3,187,734 ============== ============== Net income per unit .............................. $ 0.72 $ 0.94 ============== ============== Distributions per unit ........................... $ 1.13 $ 0.62 ============== ==============
See accompanying notes to condensed consolidated financial statements. 3 MARINE PETROLEUM TRUST AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000 (UNAUDITED)
2001 2000 ------------ ------------ Cash flows from operating activities: Net income ................................................................. $ 1,448,352 $ 1,873,299 Adjustments to reconcile net income to net cash provided by operating activities: Equity in undistributed (earnings) loss of affiliate ...................... 15,187 (49,738) Change in assets and liabilities: Oil and gas royalties receivable ..................................... 282,980 (277,048) Receivable from affiliate ............................................ 64,378 (66,646) Income taxes payable ................................................. (2,570) 2,775 ------------ ------------ Net cash provided by operating activities ......................... 1,808,327 1,482,642 ------------ ------------ Cash flows used in investing activities-- Purchase of office equipment ............................................. (1,845) -- ------------ ------------ Cash flows from financing activities-- Distributions to unitholders ............................................. (2,268,214) (1,245,558) ------------ ------------ Net increase (decrease) in cash and cash equivalents ..................... (461,732) 237,084 Cash and cash equivalents at beginning of period ............................... 2,515,239 1,681,598 ------------ ------------ Cash and cash equivalents at end of period ..................................... $ 2,053,507 $ 1,918,682 ============ ============
See accompanying notes to condensed consolidated financial statements. 4 MARINE PETROLEUM TRUST AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2001 (UNAUDITED) ACCOUNTING POLICIES The financial statements include the financial statements of Marine Petroleum Trust (the "Trust") and its wholly-owned subsidiary, Marine Petroleum Corporation ("MPC"), are condensed, and should be read in conjunction with the Trust's annual report on Form 10-K for the fiscal year ended June 30, 2001. The financial statements included herein are unaudited, but in the opinion of management include all adjustments necessary for a fair presentation of the results of operations for the periods indicated. Operating results for the three months ended September 30, 2001 are not necessarily indicative of the results that may be expected for the year ending June 30, 2002. UNDISTRIBUTED INCOME The Trust's indenture provides that the corporate trustee is to distribute all cash in the trust, less an amount reserved for the payment of accrued liabilities and estimated future expenses, to unitholders on the 28th day of March, June, September and December of each year. If the 28th falls on a Saturday, Sunday or legal holiday, the distribution is payable on the immediately preceding business day. Undistributed income includes $990,438 and $879,511 applicable to MPC at September 30, 2001 and 2000, respectively. 5 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FINANCIAL CONDITION - LIQUIDITY AND CAPITAL RESOURCES The Trust is a "royalty trust" with overriding royalty interests in oil and gas leases in the Gulf of Mexico. The Trust's indenture, and the charter and by-laws of its subsidiary, prohibit the operation of any kind of trade or business inasmuch as it was organized for the sole purpose of providing an efficient, orderly, and practical means for the administration and liquidation of rights to payments from certain oil and gas leases in the Gulf of Mexico, pursuant to license agreements and amendments thereto between the Trust's predecessors and Gulf Oil Corporation ("Gulf"). These contracts provide for an overriding royalty interest equal to three-fourths of 1% of the value at the well of any oil, natural gas, or other minerals produced and sold. As a result of various transactions that have occurred since 1956, the Gulf interests now are held by Chevron Corporation ("Chevron"), Elf Exploration, Inc. ("Elf"), and their assignees. In addition, the Trust owns a 32.6% equity interest in Tidelands Royalty Trust "B" ("Tidelands"), a separate publicly traded royalty trust. All royalties received by the Trust, less administrative expenses, are distributed quarterly to unitholders. Since the Trust's sole purpose is to collect and distribute cash collected from royalties, there are no requirements for capital. GENERAL Decreased oil and natural gas prices, partially offset by an increase in oil production, resulted in a 23% decrease in net income for the current three months as compared to the comparable three months a year ago. Distributions to unitholders amounted to $1.13 per unit for the current three months, an increase of 82% over the distribution for the comparable three months a year ago. The Trust must rely on public records for information regarding drilling operations. The public records indicate that an estimated 8 (7 successful) drilling and workover operations were conducted during the three months ended September 30, 2001 on leases in which the Trust has an interest. In the comparable period a year ago there were 16 drilling and work over operations reported. The following table presents the net production quantities of oil and natural gas and net income and distributions per unit for the last five quarters.
PRODUCTION(1) --------------------------- NATURAL NET CASH QUARTER OIL (bbls) GAS (mcf) INCOME DISTRIBUTION - ------------------------------ ------------ ------------ ------------ ------------ September 30, 2000 ........... 26,466 211,835 .94 .62 December 31, 2000 ............ 31,213 237,470 .97 .86 March 31, 2001 ............... 23,646 256,017 1.15 .94 June 30, 2001 ................ 31,229 266,558 1.18 1.17 September 30, 2001 ........... 29,748 211,925 .72 1.13
- ---------- (1) Excludes the Trust's equity interest in Tidelands. 6 The Trust's revenues are derived from the oil and natural gas production activities of unrelated parties. The Trust's revenues and distributions fluctuate from period to period based upon factors beyond the Trust's control, including, without limitation, the number of productive wells drilled and maintained on leases subject to the Trust's interest, the level of production over time from such wells and the prices at which the oil and natural gas from such wells are sold. The Trust believes that it will continue to have revenues sufficient to permit distributions to be made to unitholders for the foreseeable future, although no assurance can be made regarding the amounts thereof. The foregoing sentence is a forward-looking statement. Factors that might cause actual results to differ from expected results include reductions in prices or demand for oil and natural gas, which might then lead to decreased production; reductions in production due to depletion of existing wells or disruptions in service, including as the result of storm damage to production facilities, blowouts or other production accidents, and geological changes such as cratering of productive formations; expiration or release of leases subject to the Trust's interests. Important aspects of the Trust's operations are conducted by third parties. These include the production and sale of oil and natural gas and the calculation of royalty payments to the Trust, which are conducted by oil and natural gas companies that lease tracts subject to the Trust's interests. Similarly, the Trust's distributions are processed and paid by The Bank of New York as the agent for the trustee of the Trust. RESULTS OF OPERATIONS--THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000 Net income for the quarter ended September 30, 2001 amounted to approximately $1,448,000 which was 23% less than the approximately $1,873,000 realized in the comparable quarter a year ago. The quantities of oil and natural gas sold increased while the average price realized for oil and natural gas decreased in the current quarter as compared to the comparable quarter a year ago. Revenue from oil royalties, excluding the Trust's equity interest in Tidelands, decreased 3% to approximately $757,000 in the current quarter from approximately $778,000 realized in the comparable quarter a year ago. As shown in the table below, the decrease from the comparable quarter a year ago was due to decreased prices partially offset by increased production. Revenue from natural gas royalties, excluding the Trust's equity interest in Tidelands, decreased 31% to approximately $636,000 in the current quarter from approximately $917,000 in the comparable quarter a year ago. As shown in the table below, there was a slight increase in production and a decrease in the current quarter prices. Income from the Trust's equity in Tidelands decreased approximately 62% in the current quarter from the comparable quarter a year ago due to a decrease in Tidelands' revenue from oil and natural gas. The quantities of oil and natural gas sold and the average prices realized from current operations for the quarter ended September 30, 2001, and those realized in the comparable quarter a year ago, excluding the Trust's equity interest in Tidelands, are presented in the following table:
2001 2000 ----------- ----------- OIL Barrels sold ........ 29,748 26,466 Average price ....... $ 25.46 $ 29.39 NATURAL GAS Mcf sold ............ 211,925 211,835 Average price ....... $ 3.00 $ 4.33
7 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Not applicable. 8 PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) The following exhibits are included herein: None (b) Current Reports on Form 8-K: None 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. MARINE PETROLEUM TRUST Bank of America, N.A., Trustee November 14, 2001 By: /s/ CINDY STOVER MILLER -------------------------------------- Cindy Stover Miller Vice President November 14, 2001 By: /s/ R. RAY BELL -------------------------------------- R. Ray Bell Principal Accounting Officer 10 -----END PRIVACY-ENHANCED MESSAGE-----