EXHIBIT 20.1 COMSTOCK RESOURCES, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS The following unaudited pro forma combined financial statements should be read in conjunction with the historical consolidated financial statements, including the notes thereto, of Comstock Resources, Inc. ("Comstock") and DevX Energy, Inc. ("DevX") which are included as an exhibit to this document. The unaudited pro forma financial statements are presented for illustration purposes only, in accordance with the assumptions set forth below, and are not necessarily indicative of the operating results of financial position that would have occurred if the merger had been completed on the assumed dates. Nor is it necessarily indicative of future operating results or the financial position of the combined enterprise. P-1COMSTOCK RESOURCES, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS Year Ended December 31, 2000 Pro Forma Pro Forma Comstock DevX Adjustments Combined -------- -------- --------- --------- (In thousands, except per share amounts) Revenues: Oil and gas sales............................. $169,350 $ 35,991 $ 6,214(a) $ 211,555 Other income.................................. 352 90 -- 442 -------- -------- --------- --------- Total revenues................................ 169,702 36,081 6,214 211,997 -------- -------- --------- --------- Expenses: Oil and gas operating......................... 29,707 1,727 6,214 (a) 37,648 Exploration................................... 3,192 -- 800 (b) 3,992 Depreciation, depletion and amortization...... 44,958 8,637 13,473 (c) 58,431 (8,637)(d) General and administrative, net............... 3,537 4,497 (4,497)(e) 3,537 Interest...................................... 24,611 17,264 (17,264)(f) 35,099 10,488 (g) Change in fair value of derivatives -- 1,945 -- 1,945 --------- -------- --------- --------- Income before income taxes 63,697 2,011 5,637 71,345 Provision for income taxes (22,294) 642 (3,319)(h) (24,971) --------- --------- --------- --------- Income 41,403 2,653 2,318 46,374 Preferred stock dividends (2,471) -- -- (2,471) --------- -------- --------- --------- Net income attributable to common stock $ 38,932 $ 2,653 $ 2,318 $ 43,903 ========= ========= ========= ========= Net income per share: Basic................................. $ 1.48 $ 1.67 ========= ======== Diluted............................... $ 1.21 $ 1.36 ========= ======== Weighted average shares outstanding: Basic................................. 26,290 26,290 ========= ======== Diluted............................... 34,219 34,219 ========= ======== See accompanying notes to unaudited pro forma combined financial statements. P-2 COMSTOCK RESOURCES, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS Nine Months Ended September 30, 2001 Pro Forma Pro Forma Comstock DevX Adjustments Combined -------- -------- --------- --------- (In thousands, except per share amounts) Revenues: Oil and gas sales.............................. $ 143,521 $ 27,421 $ 5,105 (a) $ 176,047 Other income................................... 381 377 -- 758 --------- -------- --------- --------- Total revenues................................. 143,902 27,798 5,105 176,805 --------- -------- --------- --------- Expenses: Oil and gas operating.......................... 25,064 1,160 5,105 (a) 31,329 Exploration.................................... 3,371 -- 536 (b) 3,907 Depreciation, depletion and amortization....... 36,458 7,087 8,934 (c) 45,392 (7,087)(d) General and administrative, net................ 2,450 4,139 (4,139)(e) 2,450 Interest....................................... 15,479 5,518 (5,518)(f) 22,433 6,954 (g) Change in Fair Value of Derivatives............ -- (3,730) -- (3,730) --------- -------- --------- --------- Income before income taxes.......................... 61,080 13,624 320 75,024 Provision for income taxes.......................... (21,378) (5,040) 160 (h) (26,258) --------- -------- --------- --------- Income.............................................. 39,702 8,584 480 48,766 Preferred stock dividends........................... (1,199) -- -- (1,199) --------- -------- --------- --------- Net income attributable to common stock............. $ 38,503 $ 8,584 $ 480 $ 47,567 ========= ======== ========= ========= Net income per share: Basic................................. $ 1.32 $ 1.63 ========= ========= Diluted............................... $ 1.14 $ 1.40 ========= ========= Weighted average shares outstanding: Basic................................. 29,207 29,207 ========= ========= Diluted............................... 34,851 34,851 ========= ========= See accompanying notes to unaudited pro forma combined financial statements. P-3 COMSTOCK RESOURCES, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED BALANCE SHEET As of September 30, 2001 ASSETS Pro Forma Pro Forma Comstock DevX Adjustments Combined -------- -------- --------- --------- (In thousands, except per share amounts) Cash and Cash Equivalents........................... $ 3,088 $ 11,168 $ -- $ 14,256 Accounts Receivable: Oil and gas sales.............................. 18,342 5,275 -- 23,617 Joint interest operations...................... 2,569 61 -- 2,630 Other Current Assets................................ 2,146 744 -- 2,890 --------- --------- --------- --------- Total current assets.................. 26,145 17,248 -- 43,393 Property and Equipment: Unevaluated oil and gas properties............. 12,356 -- -- 12,356 Oil and gas properties, successful efforts method 730,730 211,411 (211,411)(i) 88,962 158,232 (j) Other. . ...................................... 2,618 457 (457)(i) 2,618 Accumulated depreciation, depletion and amortization............................... (265,006) (101,593) 101,593 (i) (265,006) --------- --------- --------- --------- Net property and equipment............... 480,698 110,275 47,957 638,930 Deferred Tax Asset.................................. -- 1,221 (1,221)(k) -- Other Assets........................................ 5,056 3,994 (3,994)(l) 5,056 --------- --------- --------- --------- $511,899 $ 132,738 $ 42,742 $ 687,379 ========= ========= ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current Portion of Long-Term Debt................... $ 417 $ -- $ -- $ 417 Accounts Payable and Accrued Expenses............... 37,299 10,697 11,113 (m) 59,109 --------- --------- --------- --------- Total current liabilities............. 37,716 10,697 11,113 59,526 Long-Term Debt, less current portion................ 206,000 50,000 (49,776)(n) 353,591 147,367 (o) Derivatives ...................................... -- 1,779 -- 1,779 Deferred Taxes Payable.............................. 39,969 -- 4,300 (k) 44,269 Reserve for Future Abandonment Costs................ 7,557 -- -- 7,557 Stockholders' Equity: Preferred stock............................... 17,573 -- -- 17,573 Common stock................................. 14,439 2,983 (2,983)(p) 14,439 Additional paid-in capital..................... 131,878 60,165 (60,165)(p) 131,878 Retained earnings.............................. 57,832 9,418 (9,418)(p) 57,832 Treasury stock................................. -- (525) 525 (p) -- Deferred compensation-restricted stock grants.. (876) -- (876) Accumulated other comprehensive loss........... (189) (1,779) 1,779 (p) (189) --------- --------- --------- --------- Total stockholders' equity............ 220,657 70,262 (70,262) 220,657 --------- --------- --------- --------- $ 511,899 $ 132,738 $ 42,742 $ 687,379 ========= ========= ========= ========= See accompanying notes to unaudited pro forma combined financial statements. P-4 COMSTOCK RESOURCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (Continued) (1) BASIS OF PRESENTATION - On December 17, 2001, Comstock Resources, Inc. ("Comstock") completed the acquisition of DevX Energy, Inc. ("DevX") by acquiring 100% of the common stock of DevX for $92.6 million. Comstock also repurchased approximately $49.8 million of the outstanding DevX 12.5% Senior Notes due in 2008 for 110% of the principal amount plus accrued interest. The acquisition was funded by borrowings under a new revolving bank credit facility entered into by Comstock on December 17, 2001. The new credit facility is subject to borrowing base availability, which will be redetermined semiannually based on the banks' estimates of the future net cash flows of the borrower's oil and gas properties. The revolving credit line bears interest, based on the utilization of the borrowing base, at the option of Comstock at either (i) LIBOR plus 1.5% to 2.375% or (ii) the base rate plus 0.5% to 1.375%. The facility matures on January 2, 2005. The accompanying Pro Forma Consolidated Balance Sheet at September 30, 2001 and the Pro Forma Consolidated Statements of Operations for the year ended December 31, 2000 and the nine months ended September 30, 2001, have been prepared assuming the acquisition of DevX was consummated by Comstock, immediately prior to each of the periods presented, and was funded by borrowings under Comstock's new bank credit facility. The Pro Forma Combined Statements of Operations are not necessarily indicative of the results of operations had the above described transactions occurred on the assumed dates. (2) PRO FORMA ADJUSTMENTS - Pro forma adjustments necessary to adjust the Combined Balance Sheet and Statements of Operations are as follows: (a) To reclassify certain amounts in DevX historical financial statements to conform to Comstock' s presentation. (b) To record the pro forma reversal of the capitalization of historical DevX exploration expense to conform to the successful efforts method of accounting for oil and gas activities. (c) To record pro forma DevX depreciation, depletion and amortization expenses recorded in accordance with the successful efforts method of accounting for oil and gas activities and based on the allocated purchase price. P-5 COMSTOCK RESOURCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (Continued) (d) To record the reversal of DevX historical depreciation, depletion and amortization expenses in accordance with the full-cost method of accounting for oil and gas activities. (e) To reverse the costs of the closed Dallas and Ottawa corporate offices of DevX. Comstock hired only one former DevX employee and does not intend to add any additional administrative employees to handle the incremental DevX activity. Accordingly, since the DevX offices have been closed and only one former employee has been hired Comstock believes the reduction in general and administrative expenses of DevX is factually supportable for this pro forma presentation. (f) To reverse the historical interest expense related to the DevX 12.5% Senior Notes. (g) To record interest expense related to borrowings under the Company's new bank credit facility. Borrowings to finance the purchase of DevX shares and merger costs and the purchase of the DevX 12.5% Senior Notes were approximately $152 million. The pro forma interest expense was calculated using Comstock's average interest rate on its prior bank credit facility of 6.9% and 6.1% for the year ended December 31, 2000 and the nine months ended September 30, 2001, respectively. (h) To record income tax expense on the pro forma adjustments based on the applicable statutory tax rates. (i) To reverse historical DevX property and equipment balances and the related accumulated depreciation, depletion and amortization. P-6 COMSTOCK RESOURCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (Continued) (j) To record the estimated pro forma allocation of the purchase price of the acquisition of DevX, including estimated merger costs, to properties and equipment in accordance with the purchase method of accounting. The following is a calculation and allocation of the purchase price to the assets acquired and liabilities assumed based on their relative fair values: CALCULATION OF PURCHASE PRICE - (In thousands except per share amount) Number of shares of common stock acquired 12,649 Share purchase price .................... $ 7.32 --------- $ 92,591 Estimated merger related costs .......... 11,113 --------- Purchase Price .......................... $ 103,704 ========= ALLOCATION OF PURCHASE PRICE - Current assets .......................... $ 17,248 Properties and equipment ................ 158,232 Current liabilities ..................... (10,697) Long-term debt .......................... (55,000) Deferred income taxes ................... (4,300) Derivative liabilities .................. (1,779) --------- $ 103,704 ========= The final purchase price allocation may change due to changes in DevX's working capital or the valuation of its derivatives contracts. (k) To record the pro forma deferred income tax effect of the fair value adjustments related to the merger in accordance with the purchase method of accounting. (l) To record the reversal of the capitalized debt issuance costs related to DevX historical long-term debt. (m) To record the liabilities associated with estimated merger related costs, consisting primarily of bankers' and other professional fees, as well as costs associated with severance for DevX employees and closing the DevX offices in Dallas and Ottawa. (n) To reflect repurchase of the DevX 12.5% Senior Notes at the actual purchase price of 110% of principal. (o) To record borrowings under the bank credit facility related to the acquisition of DevX and the repurchase of the DevX 12.5% Senior Notes. P-7 COMSTOCK RESOURCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (Continued) (p) To reflect the acquisition of DevX common stock and common stock equivalents pursuant to the merger agreement. (3) OIL AND GAS RESERVE INFORMATION - The following unaudited table sets forth the combined proved oil and gas reserves of Comstock and DevX at December 31, 2000: Comstock DevX Combined -------------------- -------------------- -------------------- Oil Gas Oil Gas Oil Gas (MBbls) (MMcf) (MBbls) (MMcf) MBbls) (MMcf) -------- -------- -------- -------- -------- -------- Proved Reserves: Beginning of year ............ 19,467 258,121 4,453 139,998 23,920 398,119 Revisions of previous estimates ............... (1,725) 1,205 (2,875) 6,610 (4,600) 7,815 Extensions and discoveries ... 1,599 54,574 -- -- 1,599 54,574 Purchases of minerals in place 416 11,059 -- -- 416 11,059 Sales of minerals in place ... (499) (134) (1) (7,035) (500) (7,169) Production ................... (1,807) (26,990) (216) (9,797) (2,023) (36,787) -------- -------- -------- -------- -------- -------- End of year .................. 17,451 297,835 1,361 129,776 18,812 427,611 ======== ======== ======== ======== ======== ======== Proved Developed Reserves: Beginning of year ............ 14,379 184,123 1,937 86,044 16,316 270,167 ======== ======== ======== ======== ======== ======== End of year .................. 12,290 200,349 1,253 84,669 13,543 285,018 ======== ======== ======== ======== ======== ======== The following table sets forth the combined standardized measure of discounted future net cash flows relating to proved reserves at December 31, 2000 for Comstock and DevX: Comstock DevX Combined ----------- ----------- ---------- (In thousands) Cash Flows Relating to Proved Reserves: Future Cash Flows ................................. $ 3,590,711 $ 1,451,177 $ 5,041,888 Future Costs: Production .................................... (527,939) (223,812) (751,751) Development ................................... (126,904) (21,441) (148,345) ----------- ----------- ---------- Future Net Cash Flows Before Income Taxes ......... 2,935,868 1,205,924 4,141,792 Future Income Taxes ............................... (825,033) (370,200) (1,195,233) ----------- ----------- ----------- Future Net Cash Flows ............................. 2,110,835 835,724 2,946,559 10% Discount Factor ............................... (822,071) (465,502) (1,287,573) ----------- ----------- ------------ Standardized Measure of Discounted Future Net Cash Flows $ 1,288,764 $ 370,222 $ 1,658,986 =========== =========== =========== P-8 COMSTOCK RESOURCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (Continued) The following table sets forth the combined changes in the standardized measure of discounted future net cash flows relating to proved reserves for the years ended December 31, 2000 for Comstock and DevX: Comstock DevX Combined ----------- ---------- ----------- (In thousands) Standardized Measure, Beginning of Year .......... $ 468,713 $ 116,679 $ 585,392 Net Change in Sales Price, Net of Production Costs 1,141,880 501,474 1,643,354 Development Costs Incurred During the Year Which Were Previously Estimated ...................... 17,340 13,043 30,383 Revisions of Quantity Estimates .................. (44,256) (74,940) (119,196) Accretion of Discount ............................ 51,506 11,668 63,174 Changes in Future Development Costs .............. (41,525) -- (41,525) Changes in Timing and Other ...................... (166,410) -- (166,410) Extensions and Discoveries ....................... 375,632 -- 375,632 Purchases of Reserves in Place ................... 62,621 -- 62,621 Sales of Reserves in Place ....................... (3,355) (12,953) (16,308) Sales, Net of Production Costs ................... (139,643) (34,264) (173,907) Net Changes in Income Taxes ...................... (433,739) (150,485) (584,224) ----------- ---------- ----------- Standardized Measure, End of Year ................ $ 1,288,764 $ 370,222 $ 1,658,986 =========== ========== =========== P-9
- CRK Dashboard
- Financials
- Filings
- Transcripts
- ETFs
- Insider
- Institutional
- Shorts
- News
-
8-K/A Filing
Comstock Resources (CRK) 8-K/AAcquisition or disposition of assets
Filed: 6 Feb 02, 12:00am