-----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, mPnF46mbQhIdsx0+QPNHilMBFXQ0BADvJnulCcNAC6SUWTIFJSCtgMBT719cEZCX lW3DwJBYAgFCoppBM21oFA== 0000077159-94-000007.txt : 19941122 0000077159-94-000007.hdr.sgml : 19941122 ACCESSION NUMBER: 0000077159-94-000007 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19940930 FILED AS OF DATE: 19941114 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: PENN VIRGINIA CORP CENTRAL INDEX KEY: 0000077159 STANDARD INDUSTRIAL CLASSIFICATION: 6795 IRS NUMBER: 231184320 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-00753 FILM NUMBER: 94559504 BUSINESS ADDRESS: STREET 1: 800 BELLEVUE STREET 2: 200 S BROAD ST CITY: PHILADELPHIA STATE: PA ZIP: 19102 BUSINESS PHONE: 2155456600 MAIL ADDRESS: STREET 1: 800 BELLEVUE, 200 S. BROAD ST CITY: PHILADELPHIA STATE: PA ZIP: 19102 FORMER COMPANY: FORMER CONFORMED NAME: VIRGINIA COAL & IRON CO DATE OF NAME CHANGE: 19670501 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1994 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-753 PENN VIRGINIA CORPORATION (Exact name of registrant as specified in its charter) VIRGINIA 23-1184320 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification no.) 800 THE BELLEVUE 200 SOUTH BROAD STREET, PHILADELPHIA, PA 19102 (Address of principal executive offices) (Zip code) (215)545-6600 (Registrant's telephone number; including area code) 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 re- quired 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 Number of shares of common stock of registrant outstanding at September 30, 1994: 4,279,540 PENN VIRGINIA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Three Months Nine Months Ended September 30, Ended September 30,
1994 1993 1994 1993 (In thousands, except per share data) Operating revenues: Sales $ 163 $ 238 $ 385 $ 371 Coal royalties 3,990 3,452 11,366 10,019 Oil and gas sales and royalties 3,687 3,169 12,067 10,743 Dividends 577 593 2,011 1,723 Other income, net 567 436 1,626 1,451 Total 8,984 7,888 27,455 24,307 Expenses: Cost of sales 833 652 2,274 1,965 Selling, general and administrative 2,305 1,594 5,676 4,998 Exploration and development 265 194 519 592 Depreciation, depletion and amortization 1,534 1,247 4,566 3,912 Taxes other than on income 377 365 1,141 1,224 Interest 373 451 1,247 1,403 Total 5,687 4,503 15,423 14,094 Income from operations 3,297 3,385 12,032 10,213 Income tax expense (benefit) (190) 690 2,028 2,342 Net income $ 3,487 $ 2,695 $10,004 $ 7,871 Income per common share (based on 4,279,540 weighted average shares outstanding): $ .82 $ .63 $ 2.34 $ 1.84 See accompanying notes to condensed consolidated financial statements.
PENN VIRGINIA CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Thousands of Dollars)
(Unaudited) September 30, 1994 December 31, 1993 ASSETS Current assets Cash and cash equivalents $ 8,322 $ 23,869 Receivables 5,013 3,880 Current portion of long-term notes receivable 3,571 3,571 Inventory 734 438 Current deferred tax benefit 669 669 Other 1,447 514 Total current assets 19,756 32,941 Investments 84,642 94,562 Long-term notes receivable, net of current portion 9,504 11,841 Property, plant and equipment (net) 83,667 74,093 Other assets 803 822 Total assets $ 198,372 $ 214,259
LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Current installments on long-term debt $ 7,475 $ 7,625 Accounts payable 1,411 4,456 Accrued expenses 3,873 4,535 Deferred income 203 214 Taxes on income - 587 Total current liabilities 12,962 17,417 Other liabilities 7,738 7,669 Deferred taxes 31,387 34,821 Long-term debt, net of current installments 10,150 16,575 Shareholders' Equity Preferred stock of $100 par value - authorized 100,000 shares; issued none - - Common stock of $6.25 par value - authorized 8,000,000 shares; issued 4,437,517 shares in 1994 and 1993 27,734 27,734 Other paid-in capital 34,793 34,685 Retained earnings 34,850 30,603 97,377 93,022 Less: 157,977 shares of common stock held in treasury 7,435 7,435 Guaranteed debt to Employee Stock Ownership Plan 450 900 Add: Unrealized holding gain, net of tax - investments 46,643 53,090 Total shareholders' equity 136,135 137,777 Total liabilities and shareholders' equity $ 198,372 $ 214,259 See accompanying notes to condensed consolidated financial statements.
PENN VIRGINIA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, (In Thousands)
1994 1993 Cash flows from operating activities: Net cash flows from operating activities $ 7,473 $ 15,275 Cash flows from (used in) investing activities: Payment received on long-term notes 2,976 2,769 Proceeds from the sale of fixed assets 284 73 Purchases of fixed assets (14,398) (7,718) Net cash flows (used in) investing activities (11,138) (4,876) Cash flows from (used in) financing activities: Dividends paid (5,757) (5,740) Repayment of long-term borrowings (6,575) (1,875) Reduction in Guaranteed debt to ESOP 450 450 Net cash flows (used in) financing activities (11,882) (7,165) Net increase (decrease) in cash and cash equivalents (15,547) 3,234 Cash and cash equivalents - beginning balance 23,869 4,153 Cash and cash equivalents - ending balance $ 8,322 $ 7,387 Supplemental disclosures of cash flow information: Cash paid to date for: Interest $ 1,349 $ 1,054 Income taxes $ 3,496 $ 2,086 See accompanying notes to condensed consolidated financial statements.
PENN VIRGINIA CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. In the opinion of the Company, the accompanying condensed consoli- dated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of September 30, 1994, and the results of operations for the three and nine months ended September 30, 1994 and 1993 and cash flows for the nine months ended September 30, 1994 and 1993. At December 31, 1993, the Company adopted Statement of Financial Accounting Standards No. 115, "Accounting for Certain Investments in Debt and Equity Securities". 2. Property, plant and equipment consist of the following: September 30, 1994 December 31, 1993 (In thousands) Property, plant and equipment $ 115,968 $ 101,940 Less: Accumulated depreciation and depletion (32,301) (27,847) Net property, plant and equipment $ 83,667 $ 74,093 During the second quarter of 1994, Penn Virginia Oil and Gas Corporation (PVOG) acquired the assets of CD & G Development Corporation of Pikeville, Kentucky for approximately $7 million. The CD & G assets include 116 producing oil and gas wells with proved reserves estimated at 17.5 billion cubic feet of gas. The CD & G acquisition, which increased PVOG's proven reserves by approximately 10%, also includes approximately sixty future drilling locations as well as numerous recompletion opportunities and pro- vides an excellent fit with PVOG's existing properties in eastern Kentucky and West Virginia. 3. The amortized cost, gross unrealized holding gains and fair value for available-for-sale securities at September 30, 1994 were as follows: Gross Unrealized Amortized Holding Fair Cost Gain Value (In thousands) Available-for-sale: Westmoreland Coal Company $ 5,263 $ - $ 5,263 Westmoreland Resources, Inc. 4,530 - 4,530 Norfolk Southern Corporation 3,096 71,753 74,849 Totals $ 12,889 $ 71,753 $ 84,642 The amortized cost and fair value of notes receivable which are classified as held-to-maturity securities was $13,075,000 at September 30, 1994. PENN VIRGINIA CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 3. On November 8, 1994 Westmoreland Coal Company (WCX) announced that it had not been able to obtain the consent of TECO Coal Corporation, an affiliate of TECO Energy, Inc. and Tampa Electric, to the assignment of two coal supply subcontracts to CONSOL required to complete its previously announced sale of Kentucky Criterion Coal Company. On that date WCX also announced that it and certain of its subsidiaries had filed for protection under Chapter 11 of the Federal Bankruptcy Code in the State of Delaware in the form of a reorganization proceeding known as a "pre-packaged" plan. For a further discussion of this matter, please refer to the "Liquidity, Capital Resources and Other Financial Data" section of Management's Discussion and Analysis of Results of Operations and Financial Condition. Management's Discussion and Analysis of Results of Operations and Financial Condition Results of operations for the quarter ended September 30, 1994 as compared to the quarter ended September 30, 1993: Income from operations before income taxes decreased $88,000 or 3% for the third quarter of 1994 compared to the third quarter of 1993. This decrease is composed of a $467,000 increase in the coal and land segment, a $30,000 in- crease in the investment segment, a $111,000 decrease in the oil and gas segment and a $474,000 increase in general corporate expenses and interest. Income taxes decreased as a result of a decrease in book taxable income for the third quarter of 1994 and the reversal of tax accruals relating to an Internal Revenue Service tax audit settlement for the years 1984 thru 1986 of $398,000 and the recognition of additional 1993 shale tax credits of $500,000. Coal and Land Three Months Ended September 30, 1994 1993 (Thousands of dollars) Revenues: Sales $ 163 $ 238 Royalties 3,990 3,452 Other 401 303 Total 4,554 3,993 Expenses: Cost of sales 22 26 Selling, general and administrative 396 277 Exploration and development 57 67 Depreciation, depletion and amortization 43 45 Taxes other than on income 33 42 Total 551 457 Operating Profit $ 4,003 $ 3,536 The increase in the coal and land segment operating profit of $467,000 or 13% is mainly attributable to increased coal royalties from independent coal lessees and Westmoreland Coal Company's Virginia operations of $450,000 and $255,000 respectively, due to increased tonnage offset in part by decreased royalties from Westmoreland's West Virginia operations of $167,000. In addition, selling, general and administrative expense increased by $119,000 or 43% due mainly to higher salary and employee benefit expenses. Penn Virginia Corporation received royalties from Westmoreland Coal Company totalling $3,018,000 and $2,930,000 for the three months ended September 30, 1994 and 1993 respectively. Investments Three Months Ended September 30, 1994 1993 (Thousands of dollars) Revenues: Dividends $ 577 $ 593 Other 53 - Total 630 593 Expenses: Selling, general and administrative 13 3 Depreciation - 3 Taxes other than on income 1 1 Total 14 7 Operating Profit $ 616 $ 586 The increase in the investment segment operating profit of $30,000 or 5% is mainly attributable to increased interest income of $53,000 on short-term investments. Partially offsetting this revenue increase is an increase in salary expense of $10,000 and a decrease in dividends of $16,000 due mainly to the timing of the receipt of dividends from Westmoreland Resources, Inc. in 1994 versus 1993. Depreciation expense decreased by $3,000 due to the fully- amortized status of intangible assets reached during the first half of 1994. Oil and Gas Three Months Ended September 30, 1994 1993 (Thousands of dollars) Revenues: Sales $ 3,362 $ 2,819 Royalties 325 350 Other 76 15 Total 3,763 3,184 Expenses: Cost of sales 811 626 Selling, general and administrative 751 611 Exploration and development 208 127 Depreciation, depletion and amortization 1,482 1,186 Taxes other than on income 301 313 Total 3,553 2,863 Operating Profit $ 210 $ 321 Operating profit for the oil and gas segment decreased $111,000 or 35%. This decrease was due mainly to increased cost of sales and depletion expense as a result of higher gas sales volume and increased depletion rates for 1994. In addition, selling, general and administrative expenses increased for 1994 due mainly to the relocation of the headquarter offices from Duffield, Virginia to Kingsport, Tennessee in the second quarter of 1994. Partially offsetting this decline in operating profit was an increase in gas sales revenues of $543,000 or 19% due mainly to higher gas volumes sold. The volume of gas sold increased by approximately 203% for the three months ending September 30, 1994 vs. 1993 and is mainly attributable to increased gas volumes from producing properties located in West Virginia. These properties would include the CD & G asset acquisition that occurred in the second quarter of 1994. Gas pricing declined by approximately 14% for the comparable reporting period. Corporate The increase in general corporate expenses and interest of $474,000 or approximately 45% was due mainly to an increase in general and administrative expense of $552,000 offset in part by a decline in interest expense of $78,000 due to lower debt balances outstanding. The increase in general and administrative expenses is mainly attributable to a charge of $466,000 for personnel realignment expenses and increased payroll and franchise tax expense of $30,000. Results of operations for the nine months ended September 30, 1994 as compared to the nine months ended September 30, 1993: Income from operations before income taxes increased $1,819,000 or 18%. This increase is comprised of a $1,424,000 increase in the coal and land segment, a $567,000 increase in the investment segment, a $20,000 decrease in the oil and gas segment and an increase of $152,000 in general corporate expenses and interest. Income taxes decreased as a result of the reversal of tax accruals relating to an Internal Revenue Service tax audit settlement for tax years 1984 thru 1986 of $398,000 and the recognition of additional 1993 shale tax credits of $500,000. Coal and Land Nine Months Ended September 30, 1994 1993 (Thousands of dollars) Revenues: Sales $ 385 $ 371 Royalties 11,366 10,019 Other 989 868 Total 12,740 11,258 Expenses: Cost of sales 63 52 Selling, general and administrative 990 913 Exploration and development 147 153 Depreciation, depletion and amortization 129 132 Taxes other than on income 107 128 Total 1,436 1,378 Operating Profit $ 11,304 $ 9,880 The increase in the coal and land segment operating profit of $1,424,000 or 14% is mainly attributable to increased coal royalties from independent coal lessees and Westmoreland Coal Company's Virginia operations of $1,135,000 and $422,000 respectively, due to increased tonnage mined offset in part by decreased coal royalties from Westmoreland's West Virginia operations of $210,000. Penn Virginia Corporation received royalties from Westmoreland Coal Company totalling $8,561,000 and $8,349,000 for the nine months ending September 30, 1994 and 1993 respectively. Investments Nine Months Ended September 30, 1994 1993 (Thousands of dollars) Revenues: Dividends $ 2,011 $ 1,723 Other 277 - Total 2,288 1,723 Expenses: Selling, general and administrative 45 45 Depreciation 4 7 Taxes other than on income 2 1 Total 51 53 Operating Profit $ 2,237 $ 1,670 The increase in the investment segment operating profit of $567,000 or 34% is mainly attributable to increased dividend income of $288,000 due to the timing of dividends received from Westmoreland Resources, Inc. in 1994. Interest income earned on short-term investments increased by $277,000 due to the availability of prior year asset sale proceeds received in 1993. Oil and Gas Nine Months Ended September 30, 1994 1993 (Thousands of dollars) Revenues: Sales $ 10,661 $ 9,503 Royalties 1,406 1,240 Other 212 351 Total 12,279 11,094 Expenses: Cost of sales 2,211 1,913 Selling, general and administrative 2,078 1,653 Exploration and development 372 439 Depreciation, depletion and amortization 4,405 3,735 Taxes other than on income 914 1,035 Total 9,980 8,775 Operating Profit $ 2,299 $ 2,319 Total revenues for the oil and gas segment increased by $1,185,000 or 11%. This increase is due mainly to higher gas sales and royalties caused by higher gas volumes from prior and current year reserve acquisitions in West Virginia. The total volume of gas sold increased approximately 154% in 1994 vs. 1993. Gas pricing declined by approximately 6% for the comparable reporting period. Partially offsetting this revenue increase was a decrease in other income due mainly to a one-time payment for leased property received in 1993 offset in part by higher compression income and the recognition of higher gains on asset sales in 1994. Total expenses increased by $1,205,000 or approximately 14%. This increase is mainly attributable to higher cost of sales due to higher gas volumes sold, higher selling, general and administrative expenses related to the relocation of the headquarter offices from Duffield, Virginia to Kingsport, Tennessee during the second quarter of 1994 and an increase in depletion expense due to increased depletion rates and higher gas sales. Partially offsetting these increased expenses was a decrease in property and franchise tax expense. Corporate The increase in general corporate expenses and interest of $152,000 or approximately 4% was due mainly to an increase in general and administrative expense of $308,000 offset in part by a decrease in interest expense of $156,000 due to lower debt balances outstanding. The increase in general and administrative expense is mainly attributable to a charge of $466,000 for personnel realignment expenses and increased payroll and franchise taxes of $56,000 offset in part by lower salary, consulting and insurance expenses. Additionally, interest income on short-term investments decreased by $60,000 and other income decreased by $27,000 due mainly to a one-time tax refund received in 1993. Financial Condition as of September 30, 1994: There were no material changes in the Company's financial condition from that reported as of December 31, 1993 except for the change in working capital discussed below. Liquidity, Capital Resources and Other Financial Data at September 30, 1994: Working capital at September 30, 1994 was $6.8 million compared to $15.5 million at December 31, 1993. See the Condensed Consolidated Statement of Cash Flows for details regarding the change. At September 30, 1994, there were $2.0 million in unused credit lines. There are two main factors that could influence future earnings and cash flow of the Company. One of these is gas prices. Since the majority of the Company's gas is sold in the spot market or under contracts less than one year in duration, future earnings will be directly related to the fluctuation of those prices. Any sustained decline in these prices could result in some impairment of oil and gas assets. The second factor is the performance of Westmoreland Coal Company ("WCX"),our largest coal lessee. In 1993, WCX reported a loss from continuing operations of $99 million that was caused primarily by the writedown of the assets of various eastern operations. On April 18, 1994, WCX announced that its outside auditors had issued a qualified opinion on its 1993 financial statements due to the uncertainty of its ability to continue as a going concern. The opinion was based on losses associated with WCX's eastern coal operations, a working capital deficiency caused by a reclassification of its revolving credit and insurance company debt to current liabilities, and violation of various covenants in WCX's principal credit arrangements. After the filing of its annual report, WCX announced an agreement in principle to sell the assets of its cogeneration subsidiary for an amount in excess of $50 million plus the assumption of certain equity commitments. On May 9, 1994 WCX announced that it had suspended the payment of its preferred stock dividend as a result of negotiations with its lenders. WCX also announced that it is continuing the process of reviewing its eastern properties with potential purchasers. On July 13, 1994 WCX announced that it had reached an agreement with its lenders to extend the maturity dates of two of its credit lines until July 29, 1994. At that time, the balance due on these facilities was $21 million. WCX also stated its intention to seek a maturity extension of its other outstanding indebtedness of $25 million, relating to letters of credit issued in connection with its interest in a coal export facility. On July 28, 1994 WCX announced that it had reached a definitive agreement to sell the assets of its wholly-owned subsidiary, Kentucky Criterion Coal Company, to CONSOL of Kentucky, Inc., a member of the CONSOL coal group for $85 million subject to an inventory adjustment at closing. The sale is subject to third party consents. WCX has stated that the proceeds from this sale would enable it to discharge its debt obligations of approximately $46 million. WCX anticipates the closing of this sale to occur early in the month of November, 1994. On August 25, 1994 WCX announced that the assets of its cogeneration subsidiary were no longer being offered for sale. WCX cited its inability to properly value these assets with adequate certainty as the primary reason for its decision. WCX stated that it will reclassify these assets to continuing operations and expects that these assets will make a significant and growing contribution to its operating earnings. On September 9, 1994 WCX announced that its lenders had extended the maturity dates of its credit line obligations to November 1, 1994. The total amount due on these credit facilities as of that date was approximately $44.4 million. WCX announced on November 1, 1994 that its lenders had agreed to yet another debt maturity extension to November 8, 1994 to allow WCX the extra time required to obtain the necessary consents needed to complete the sale of the assets of Kentucky Criterion Coal Company to CONSOL of Kentucky, Inc. The balance due on these credit facilities on November 1, 1994 was $38 million. On November 8, 1994 WCX announced that it has not been able to obtain the consent of TECO Coal Corporation, an affiliate of TECO Energy, Inc. and Tampa Electric, to the assignment of two coal supply subcontracts to CONSOL required to complete the previously announced sale of Kentucky Criterion Coal Company. On that date, WCX also announced that it and certain of its subsidiaries had filed for protection under Chapter 11 of the Federal Bankruptcy Code in the State of Delaware in the form of a reorganization proceeding known as a "prepackaged plan". According to WCX, the purpose of the filing is to protect the company from any action by its principal lenders and to permit it to complete the sale of Kentucky Criterion. WCX also stated that the bankruptcy code provides for the assignment of the sub-contracts without the consent of TECO and that it expects this form of filing to result in an expeditious closing on the Kentucky Criterion sale to CONSOL. Furthermore, WCX added that CONSOL is committed to purchase the assets of Kentucky Criterion under this structure and that the proceeds from this sale would be used to payoff its debt obligations of $38 million after which WCX expects to be discharged from and come out of bankruptcy. Without the completed sale of Kentucky Criterion or this bankruptcy filing, WCX's restructured debt would have come due as previously stated on November 8, 1994. WCX also stated that the purpose of the bankruptcy plan is to satisfy or leave unaffected all of WCX's debt obligations and stockholder interests, and that it intends to continue to mine coal and honor its royalty commitments and other obligations. Accordingly, the Company does not anticipate that its coal royalties will be materially affected by the bankruptcy filing. At present, the Company believes it is too early to speculate on the effect that WCX's recent action will have on that company's long-term stock price. The Company intends to monitor closely WCX's bankruptcy proceeding with re- spect to further developments. WCX is burdened by a difficult coal price environment and significant costs for retirees and idle mines that must be borne by a shrinking production base. If WCX cannot mine profitably, then Penn Virginia's cash flows would be adversely affected. A prolonged period of depressed prices for coal would affect the merchantability of the reserves leased to WCX and could ultimately result in a curtailment of production from Penn Virginia's reserves. The Company continues to evaluate its investment in WCX and any deterioration in WCX's financial condition that results in the carrying value for that investment being in excess of fair value could result in additional losses. Except for matters discussed above, management is not presently aware of any trends or demands which exist or uncertainties which are reasonably likely to result in the Company's liquidity increasing or decreasing in any material way. REVIEW BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT The accompanying condensed consolidated financial statements have been reviewed by the Company's independent certified public accountants, KPMG Peat Marwick LLP, in accordance with the established professional standards and procedures for such a limited review. PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits Exhibit 15: Letter Re: Unaudited interim financial information. Exhibit 27: Financial data schedule for the nine months ending September 30, 1994. (b) Reports on Form 8-K: No reports on Form 8-K were filed for the quarter ended September 30, 1994. 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. PENN VIRGINIA CORPORATION (Registrant) Date: November 14, 1994 Robert J. Jaeger Robert J. Jaeger, Vice President, Treasurer & Controller (Principal Financial and Accounting Officer) KPMG Peat Marwick LLP Certified Public Accountants 1600 Market Street Philadelphia, PA 19103 INDEPENDENT ACCOUNTANTS' REPORT The Board of Directors Penn Virginia Corporation We have reviewed the accompanying condensed consolidated balance sheet of Penn Virginia Corporation and subsidiaries as of September 30, 1994 and the related condensed consolidated statements of income for the three and nine month periods ended September 30, 1994 and 1993, and condensed consolidated statement of cash flows for the nine month periods ended September 30, 1994 and 1993. These financial statements are the responsibility of the Company's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical review procedures to financial information and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the accompanying condensed consolidated financial statements for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of Penn Virginia Corporation and subsidiaries as of December 31, 1993, and the related consolidated statements of income, shareholders' equity and cash flows for the year then ended (not presented herein); and in our report dated March 1, 1994, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 1993, is fairly presented, in all material respects in relation to the consolidated balance sheet from which it has been derived. KPMG PEAT MARWICK LLP KPMG PEAT MARWICK LLP Philadelphia, PA November 9, 1994 EX-15 2 KPMG Peat Marwick LLP Certified Public Accountants 1600 Market Street Philadelphia, PA 19103 Exhibit 15 Penn Virginia Corporation 200 S. Broad Street 800 The Bellevue Philadelphia, PA 19102 Re: Registration Statement Nos. 2-67355, 2-77500 and 33-40430 Gentlemen: With respect to the subject Registration Statements, we acknowledge our awareness of the use therein of our report dated November 9, 1994 related to our review of interim financial information. Pursuant to Rule 436(c) under the Securities Act, such report is not considered a part of a Registration Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of the Act. Very truly yours, KPMG PEAT MARWICK LLP KPMG PEAT MARWICK LLP November 14, 1994 EX-27 3 ARTICLE 5 FDS FOR 3RD QUARTER 10-Q
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONDENSED CONSOLIDATED BALANCE SHEET AT SEPTEMBER 30, 1994 AND THE CONDENSED CONSOLIDATED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1994 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 9-MOS DEC-31-1993 SEP-30-1994 8,322 0 8,584 0 734 19,756 115,968 32,301 198,372 12,962 0 27,734 0 0 108,401 198,372 11,046 27,455 2,274 2,274 11,902 0 1,247 12,032 2,028 10,004 0 0 0 10,004 2.34 2.34
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