-----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, IM7pTPHXLX7BYbPI7RjjgBec24UeG39RZrR9m/3gUW8mPGZbj/fPnbewSCsobsTQ SO43q7RhrnunY66vLVM6+Q== 0000914760-95-000124.txt : 19951119 0000914760-95-000124.hdr.sgml : 19951119 ACCESSION NUMBER: 0000914760-95-000124 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951114 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: MAYNARD OIL CO CENTRAL INDEX KEY: 0000063528 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 751362284 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-05704 FILM NUMBER: 95591768 BUSINESS ADDRESS: STREET 1: 8080 N CENTRAL EXPWY STE 660 CITY: DALLAS STATE: TX ZIP: 75206 BUSINESS PHONE: 2148918880 MAIL ADDRESS: STREET 1: 8080 N CENTRAL EXPWY STE 660 CITY: DALLAS STATE: TX ZIP: 75206 FORMER COMPANY: FORMER CONFORMED NAME: HOMA OIL & GAS CO DATE OF NAME CHANGE: 19710902 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ending September 30, 1995 Commission File #0-5704 ------------------ ------- MAYNARD OIL COMPANY --------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 75-1362284 --------------------------------------------------------------------------- (State or other jurisdic- (IRS Employer tion of incorporation) Identification No.) 8080 N. Central Expressway, Suite 660, Dallas, Texas 75206 ---------------------------------------------------------------------------- Registrant's telephone number, including area code: (214) 891-8880 ------------- 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, 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 November 10, 1995. 4,890,315 shares of common stock, par value $0.10 ------------------------------------------------------------------ MAYNARD OIL COMPANY AND SUBSIDIARIES Index to Consolidated Financial Statements and Schedules Page ---- Part I. Financial Information Consolidated Balance Sheets September 30, 1995 and December 31, 1994 Consolidated Statements of Operations Nine Months and Three Months ended September 30, 1995 and 1994 Consolidated Statements of Shareholders' Equity Nine Months ended September 30, 1995 Consolidated Statements of Cash Flows Nine Months ended September 30, 1995 and 1994 Notes to Consolidated Financial Statements Management's Discussion and Analysis of Financial Condition and Results of Operations Signatures MAYNARD OIL COMPANY AND SUBSIDIARIES Consolidated Balance Sheets
September 30 December 31, ------------ ------------ 1995 1994 ---- ---- (Unaudited) (Audited) ASSETS Current assets: Cash and cash equivalents $12,486,691 $ 5,836,389 Accounts receivable, trade 2,590,845 2,411,451 Recoverable income taxes -- 320,500 Inventories 207,908 261,959 Prepaid expenses and other current assets 187,089 199,628 ---------- ---------- Total current assets 15,472,533 9,029,927 ---------- ---------- Property and equipment, at cost: Oil and gas properties, successful efforts method 92,665,314 81,863,254 Other property and equipment 823,278 670,110 ---------- ---------- 93,488,592 82,533,364 Less accumulated depreciation and amortization (48,083,862) (43,492,197) ---------- ---------- Net property and equipment 45,404,730 39,041,167 ---------- ---------- $60,877,263 $48,071,094 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current installments of long-term debt $ 3,125,000 $ 1,750,000 Accounts payable 4,621,510 2,611,209 Accrued expenses 1,055,570 590,138 Income taxes payable 479,369 -- ---------- ---------- Total current liabilities 9,281,449 4,951,347 ---------- ---------- Deferred income taxes 1,882,510 1,732,510 Long-term debt 10,718,750 5,250,000 Shareholders' equity: Preferred stock of $.50 par value. Authorized 1,000,000 shares; none issued -- -- Common stock of $.10 par value. Authorized 20,000,000 shares; 4,890,352 and 4,891,379 shares issued and outstanding at September 30, 1995 and December 31, 1994, respectively 489,035 489,138 Additional paid-in capital 18,831,138 18,725,538 Retained earnings 19,674,381 16,922,561 ---------- ---------- Total shareholders' equity 38,994,554 36,137,237 ---------- ---------- Commitments $60,877,263 $48,071,094 =========== =========== See accompanying Notes to Consolidated Financial Statements.
MAYNARD OIL COMPANY AND SUBSIDIARIES Consolidated Statements of Operations
Nine Months ended Three Months ended September 30, September 30, ------------------ ------------------ 1995 1994 1995 1994 ---- ---- ---- ---- Revenues: Oil and gas sales and royalties $15,268,992 $9,703,628 5,120,668 $3,197,136 ---------- ---------- ---------- --------- Costs and expenses: Operating expenses 6,328,838 3,760,704 2,309,875 1,309,057 Dry holes and abandonments 95,684 517,028 11,296 22,633 Lease rentals and seismic 34,723 335,050 12,130 75,596 General and administrative 635,666 1,312,870 200,851 382,688 Depreciation and amortization 4,960,876 4,061,183 1,725,969 1,149,534 ---------- ---------- ---------- --------- 12,055,787 9,986,835 4,260,121 2,939,508 ---------- ---------- ---------- --------- Operating profit (loss) 3,213,205 (283,207) 860,547 257,628 ---------- ---------- ---------- --------- Other income (deductions): Interest income 352,165 338,058 158,243 126,780 Interest expense (719,541) (108,546) (279,509) (33,620) Gain (loss) on disposition of assets 1,010,806 20,244 870,405 6,092 ---------- ---------- ---------- --------- 643,430 249,756 749,139 99,252 ---------- ---------- ---------- --------- Net income (loss) before income taxes 3,856,635 (33,451) 1,609,686 356,880 Income tax expense (benefit) 945,500 (277,472) 395,500 (187,472) ---------- ---------- ---------- --------- Net income (loss) $2,911,135 $244,021 $1,214,186 $544,352 ========== ========== ========== ========= Weighted average number of common shares outstanding 4,890,801 4,891,662 4,889,912 4,891,511 ========== ========== ========== ========= Net income (loss) per common share $ .60 $ .05 $ .25 $ .11 ===== ===== ===== ===== See accompanying Notes to Consolidated Financial Statements.
MAYNARD OIL COMPANY AND SUBSIDIARIES Consolidated Statements of Shareholders' Equity Nine Months Ended September 30, 1995 (Unaudited)
Common Stock Additional ------------ Paid-in Capital Retained Shares Amount Amount Earnings Total ------ ------ ------ -------- ----- Balance at December 31, 1994 4,891,379 $489,138 $18,725,538 $16,922,561 $36,137,237 Net income -- -- -- 2,911,135 2,911,135 Exercise of stock options 24,000 2,400 105,600 -- 108,000 Purchase of common stock (25,027) (2,503) -- (159,315) (161,818) --------- -------- ----------- ----------- ----------- Balance at September 30, 1995 4,890,352 $489,035 $18,831,138 $19,674,381 $38,994,554 ========= ======== =========== =========== =========== See accompanying Notes to Consolidated Financial Statements.
MAYNARD OIL COMPANY AND SUBSIDIARIES Consolidated Statements of Cash Flows
Nine Months Ended September 30, 1995 1994 ---- ---- Cash flows from operating activities: Net income $2,911,135 $ 244,021 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 4,960,876 4,061,183 Deferred income taxes 150,000 33,000 Dry holes and abandonments 95,684 517,028 Current year costs of dry holes and abandonments (95,684) (517,028) (Gain) on disposition of assets (1,010,806) (20,244) (Increase) decrease in current assets: Accounts receivable (179,394) 493,964 Recoverable income taxes 320,500 (385,472) Inventories 54,051 265,895 Prepaid expenses and other current assets 12,539 (34,187) Increase (decrease) in current liabilities: Accounts payable 2,010,301 (292,339) Accrued expenses 465,432 190,049 Income taxes payable 479,369 (500,000) ----------- ---------- Net cash provided by operating activities 10,174,003 4,055,870 ----------- ---------- Cash flows from investing activities: Proceeds from disposition of assets 3,404,198 40,091 Additions to property and equipment (13,717,831) (3,774,656) ----------- ---------- Net cash used by investing activities (10,313,633) (3,734,565) ----------- ---------- Cash flows from financing activities: Proceeds from issuance of long-term debt 9,500,000 -- Principal payments on long-term debt (2,656,250) (1,500,000) Purchase of common stock (161,818) (63,615) Exercise of stock options 108,000 53,935 ----------- ---------- Net cash provided (used) by financing activities 6,789,932 (1,509,680) ----------- ---------- Net increase (decrease) in cash and cash equivalents 6,650,302 (1,188,375) Cash and cash equivalents at beginning of year 5,836,389 12,404,197 ----------- ---------- Cash and cash equivalents at end of period $12,486,691 $11,215,822 =========== ========== See Accompanying Notes to Consolidated Financial Statements.
MAYNARD OIL COMPANY AND SUBSIDIARIES Notes to Consolidated Financial Statements September 30, 1995 1. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments, consisting of all recurring adjustments, necessary to present fairly the Company's financial position as of September 30, 1995 and December 31, 1994, the results of operations for the nine months ended September 30, 1995 and 1994 and changes in cash and cash equivalents for the nine months ended September 30, 1995 and 1994. The accounting policies followed by the Company are set forth in Note 1 to the Company's financial statements in the 1994 Annual Report to Shareholders. 2. Net income for the nine months ended September 30, 1995 is not necessarily indicative of the results of the operations of Maynard Oil Company and Subsidiaries for the year ending December 31, 1995, and is subject to audit adjustments at year-end. 3. Net income (loss) per common share is based on the weighted average number of shares outstanding in each period, which was 4,890,801 and 4,891,662 shares at September 30, 1995 and 1994, respectively. The difference between primary and fully diluted earnings per share, which assumes the exercise of stock options, is not significant. 4. Effective January 1, 1995, the Company purchased interests in approximately 200 producing wells in eight West Texas counties from Pennzoil Exploration and Production Company for a gross purchase price of $10.5 million, which has been added to oil and gas properties on the Consolidated Balance Sheet. This amount was adjusted for the results of operations from January 1, 1995 through March 29, 1995, the closing date for this transaction. The funds to acquire these properties were provided from the Company's cash resources and additional bank borrowings (See Note 5 below). 5. Long-term debt at September 30, 1995 is summarized as follows: September 30 1995 -------- Amended term note due in 20 equal quarterly installments commencing July 1, 1995, plus one payment of $437,500 due April 1, 1995. Interest paid quarterly at varying rates. Secured by certain oil and gas properties. $13,843,750 Less current installments 3,125,000 ----------- Long-term debt $10,718,750 =========== Effective March 29, 1995, the Company amended its loan agreement with Bank One, Texas to increase its outstanding loan from $6,562,500 to $16,062,500 in connection with the acquisition of the Pennzoil properties discussed in Note 4 above. Under the terms of the loan agreement, the normal 1995 payments would have totaled $1,656,250. However, due to the sale of one of the properties acquired from Pennzoil, an additional $1,000,000 was paid to the bank. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Nine Months Ended September 30, 1995 Compared to Nine Months Ended September 30, 1994 ------------------------------------------------ The Company reported net income of $2,911,135, or sixty cents per share, on revenues of $15,268,992 for the nine months ended September 30, 1995 compared with net income of $244,021 or five cents per share, on revenues of $9,703,628 for the same period a year ago. Earnings for the 1995 period were favorably impacted by the results of operations on the two property acquisitions consummated over the last nine months. Oil volumes rose 304,394 barrels during the current period with 71% of the increase coming from the newly acquired properties and the balance of the increase from the success of the Company s development drilling program. Oil pricing increases also helped current period results; the average price received during the 1994 period was $15.17 compared to an average of $17.15 per barrel during the 1995 period, a 13% increase. Gas volumes improved 243,839 mcf (thousand cubic feet) of gas because of the property acquisitions, but failed to offset the gas pricing decline of 56 cents per mcf. Expense categories are difficult to compare because of the two property acquisitions. Lease operating expense and depreciation and amortization expense have increased, as would be expected with additional properties. However, general and administrative expenses are $677,204 less than the same period a year ago, in spite of the addition of the new properties referred to above. The Company's accounting procedure offsets the monies earned from being operator of oil and gas properties against general and administrative expenses. There were approximately 200 properties acquired in December, 1994 on which the Company is now the operator, thus lowering the overall general and administrative costs. Dry hole expense and lease rentals and seismic are $721,671 less in 1995 than 1994 due to a slowing of the Company s exploration activities. Other income (deductions) have also been impacted by the Company s property acquisitions. Interest expense grew in 1995 due to bank borrowings to finance the properties acquired; additionally, a gain of almost one million dollars was generated when two of the newly acquired properties were sold. Thus, in 1994, $249,756 was added to net income in the other income (deductions) category, while $643,430 was contributed to earnings in 1995. Quarter Ended September 30, 1995 Compared with Quarter Ended September 30, 1994 ----------------------------------------- For the quarter ended September 30, 1995, the Company earned $1,214,186, or twenty-five cents per share, compared with earnings of $544,352, or eleven cents per share, for the same quarter a year ago. The current quarter s results improved because of revenue increases associated with the property acquisitions discussed above and the gain related to the sale of one of properties recently acquired. Liquidity and Capital Resources ------------------------------- The Company ended its first nine months of 1995 with working capital of approximately $6,200,000 and a current ratio of 1.7 to 1, compared to working capital of approximately $8,584,000 and a current ratio of 2.7 to 1 a year ago. The decline in working capital between the current period and a year ago, $2,384,000, was caused by the $20 million acquisition of producing properties for cash and additional bank financing. At September 30, 1995 the Company's total debt was $13,843,750. The Company believes that it has sufficient cash being generated from operating activities or additional borrowing capacity to fund its planned development and exploratory work. 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. MAYNARD OIL COMPANY By: /s/ Glenn R. Moore ---------------------------- Glenn R. Moore President By: /s/ Kenneth W. Hatcher ----------------------------- Kenneth W. Hatcher Vice President of Finance Dated: November 10, 1995 EX-27 2
5 9-MOS DEC-31-1995 SEP-30-1995 12,487 0 2,634 43 208 15,743 93,489 48,084 60,877 9,281 0 489 0 0 37,339 60,877 15,269 15,269 6,239 12,056 (1,363) 0 720 3,857 946 2,911 0 0 0 2,911 0.60 0.60
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