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 THE QUARTER ENDED DECEMBER 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 Employer 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 February 6, 1994: Energen Corporation, $0.01 par value 10,911,377 shares Alabama Gas Corporation, $0.01 par value 1,972,052 shares ENERGEN CORPORATION AND ALABAMA GAS CORPORATION FORM 10-Q FOR THE QUARTER ENDED DECEMBER 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 to 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 17 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 18 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 December 31, (in thousands, except share data) 1994 1993 OPERATING REVENUES Natural gas distribution $67,226 $78,993 Oil and gas production activities 5,931 6,201 Other 2,416 5,248 Intercompany eliminations (2,089) (2,523) Total operating revenues 73,484 87,919 OPERATING EXPENSES Cost of gas 31,050 43,374 Operations 22,127 23,143 Maintenance 2,264 2,251 Depreciation, depletion and amortization 6,966 6,711 Taxes, other than income taxes 5,641 6,727 Total operating expenses 68,048 82,206 OPERATING INCOME 5,436 5,713 OTHER INCOME (EXPENSE) Interest expense, net of amounts capitalized (2,775) (2,922) Other, net 724 196 Total other income (expense) (2,051) (2,726) INCOME BEFORE INCOME TAXES 3,385 2,987 Income taxes 649 687 NET INCOME $ 2,736 $2,300 EARNINGS PER AVERAGE COMMON SHARE $ 0.25 $ 0.22 DIVIDENDS PER COMMON SHARE $ 0.28 $ 0.27 AVERAGE COMMON SHARES OUTSTANDING 10,920 10,587 The accompanying Notes are an integral part of these statements. CONSOLIDATED BALANCE SHEETS Energen Corporation and Subsidiaries (Unaudited) December 31, September 30, (in thousands) 1994 1994 ASSETS PROPERTY, PLANT AND EQUIPMENT Utility plant $ 473,887 $ 464,593 Less accumulated depreciation 235,579 231,327 Utility plant, net 238,308 233,266 Oil and gas properties, successful efforts method 95,239 92,355 Less accumulated depreciation, depletion and amortization 44,944 43,052 Oil and gas properties, net 50,295 49,303 Other property, net 4,395 4,613 Total property, plant and equipment, net 292,998 287,182 CURRENT ASSETS Cash and cash equivalents 2,527 27,526 Accounts receivable, net of allowance for doubtful accounts of $2,037 at December 31, 1994 and September 30, 1994 45,078 34,145 Inventories, at average cost Storage gas 24,364 24,363 Materials and supplies 7,824 7,589 Liquified natural gas in storage 3,902 3,349 Deferred gas costs 8,905 1,460 Deferred income taxes 7,600 7,542 Prepayments and other 2,699 3,117 Total current assets 102,899 109,091 OTHER ASSETS Notes receivable 3,683 3,911 Deferred charges and other 10,999 11,130 Total other assets 14,682 15,041 TOTAL ASSETS $ 410,579 $411,314 The accompanying Notes are an integral part of these statements. CONSOLIDATED BALANCE SHEETS Energen Corporation and Subsidiaries (Unaudited) December 31, September 30, (in thousands) 1994 1994 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, 10,917,577 shares outstanding at December 31, 1994 and 10,917,904 shares outstanding at September 30, 1994 109 109 Premium on capital stock 81,134 81,073 Capital surplus 2,802 2,802 Retained earnings 82,720 83,042 Treasury stock at cost, 2,400 shares (49) - Total common shareholders' equity 166,716 167,026 Long-term debt 118,210 118,302 Total capitalization 284,926 285,328 CURRENT LIABILITIES Long-term debt due within one year 3,793 10,123 Notes payable to banks 2,000 6,000 Accounts payable 35,186 27,480 Accrued taxes 13,034 13,083 Customers' deposits 17,807 17,462 Amounts due customers 13,211 11,734 Accrued wages and benefits 10,422 9,662 Other 15,081 15,129 Total current liabilities 110,534 110,673 DEFERRED CREDITS AND OTHER LIABILITIES Deferred income taxes 1,827 1,706 Accumulated deferred investment tax credits 4,469 4,590 Other 8,823 9,017 Total deferred credits and other liabilities 15,119 15,313 COMMITMENTS AND CONTINGENCIES - - TOTAL CAPITAL AND LIABILITIES $ 410,579 $411,314 The accompanying Notes are an integral part of these statements. CONSOLIDATED STATEMENTS OF CASH FLOW Energen Corporation and Subsidiaries (Unaudited) Three months ended December 31, (in thousands) 1994 1993 OPERATING ACTIVITIES Net Income $ 2,736 $ 2,300 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion and amortization 6,966 6,711 Deferred income taxes, net (103) 212 Deferred investment tax credits, net (121) (121) Gain on sale of equity securities - (1,375) Net change in: Accounts receivable (10,933) (15,590) Inventories (789) (22,201) Accounts payable 7,706 10,915 Other current assets and liabilities (4,542) (6,853) Other, net (125) (98) Net cash provided by (used in) operating activities 795 (26,100) INVESTING ACTIVITIES Additions to property, plant and equipment (12,558) (7,193) Proceeds from sale of equity securities - 3,305 Payments on notes receivable 228 693 Other, net 4 1,569 Net cash used in investing activities (12,326) (1,626) FINANCING ACTIVITIES Payment of dividends on common stock (3,058) (2,795) Issuance of common stock 61 14,721 Purchase of treasury stock (49) - Reduction of long-term debt and preferred stock of subsidiary (6,422) (8,899) Proceeds from issuance of medium-term notes - 26,675 Net change in short-term debt (4,000) (12,000) Net cash provided by (used in) financing activities (13,468) 17,702 Net change in cash and cash equivalents (24,999) (10,024) Cash and cash equivalents at beginning of period 27,526 15,008 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,527 $ 4,984 The accompanying Notes are an integral part of these statements. STATEMENTS OF INCOME Alabama Gas Corporation (Unaudited) Three months ended December 31, (in thousands) 1994 1993 OPERATING REVENUES $67,226 $78,993 OPERATING EXPENSES Cost of gas 31,994 44,610 Operations 18,357 18,248 Maintenance 2,228 2,153 Depreciation 4,737 4,427 Income taxes Current 1,062 361 Deferred, net (118) (32) Deferred investment tax credits, net (122) (122) Taxes, other than income taxes 5,392 6,403 Total operating expenses 63,530 76,048 OPERATING INCOME 3,696 2,945 OTHER INCOME Allowance for funds used during construction 186 76 Other, net 158 (208) Total other income 344 (132) INTEREST CHARGES Interest on long-term debt 1,757 1,419 Other interest expense 532 698 Total interest charges 2,289 2,117 NET INCOME AVAILABLE FOR COMMON $ 1,751 $ 696 The accompanying Notes are an integral part of these statements. BALANCE SHEETS Alabama Gas Corporation (Unaudited) December 31, September 30, (in thousands) 1994 1994 ASSETS PROPERTY, PLANT AND EQUIPMENT Utility plant $ 473,887 $ 464,593 Less accumulated depreciation 235,579 231,327 Utility plant, net 238,308 233,266 Other property, net 180 183 CURRENT ASSETS Cash and cash equivalents 1,391 156 Accounts receivable Gas 31,257 22,209 Merchandise 1,485 1,326 Other 1,654 1,512 Allowance for doubtful accounts (2,000) (2,000) Inventories, at average cost Storage gas 24,364 24,363 Materials and supplies 5,550 5,688 Liquified natural gas in storage 3,902 3,349 Deferred gas costs 8,905 1,460 Deferred income taxes 5,770 5,724 Prepayments and other 2,196 2,595 Total current assets 84,474 66,382 DEFERRED CHARGES AND OTHER ASSETS 9,054 9,074 TOTAL ASSETS $332,016 $308,905 The accompanying Notes are an integral part of these statements. BALANCE SHEETS Alabama Gas Corporation (Unaudited) CAPTION> December 31, September 30, (in thousands) 1994 1994 CAPITAL AND LIABILITIES CAPITALIZATION Common shareholder's equity Common stock, $0.01 par value; 3,000,000 shares authorized, 1,972,052 shares outstanding at December 31, 1994 and September 30, 1994 $ 20 $ 20 Premium on capital stock 31,682 31,682 Capital surplus 2,802 2,802 Retained earnings 79,778 81,087 Total common shareholder's equity 114,282 115,591 Cumulative preferred stock, $0.01 par value, 120,000 shares authorized, issuable in series-$4.70 Series - - Long-term debt 84,359 84,391 Total capitalization 198,641 199,982 CURRENT LIABILITIES Long-term debt due within one year 2,793 2,823 Notes payable to banks 2,000 4,000 Accounts payable Other 28,239 19,002 Affiliated companies 17,581 132 Accrued taxes 12,952 14,241 Customers' deposits 17,807 17,462 Supplier refunds due customers - 832 Other amounts due customers 13,211 10,902 Accrued wages and benefits 6,075 5,659 Other 6,673 7,605 Total current liabilities 107,331 82,658 DEFERRED CREDITS AND OTHER LIABILITIES Deferred income taxes 13,798 13,704 Accumulated deferred investment tax credits 4,469 4,590 Regulatory liability 6,746 6,960 Customer advances for construction and other 1,031 1,011 Total deferred credits and other liabilities 26,044 26,265 COMMITMENTS AND CONTINGENCIES - - TOTAL CAPITAL AND LIABILITIES $332,016 $308,905 The accompanying Notes are an integral part of these statements. STATEMENTS OF CASH FLOW Alabama Gas Corporation (Unaudited) Three months ended December 31, (in thousands) 1994 1993 OPERATING ACTIVITIES Net Income $ 1,751 $ 696 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 4,737 4,427 Deferred income taxes, net (118) (32) Deferred investment tax credits (122) (122) Net change in: Accounts receivable (9,349) (14,869) Inventories (416) (22,422) Accounts payable 9,340 15,342 Other current assets and liabilities (7,029) (8,398) Other, net (175) 461 Net cash used in operating activities (1,381) (24,917) INVESTING ACTIVITIES Additions to property, plant and equipment (9,551) (5,214) Net advances to holding company - 87 Other, net (57) (21) Net cash used in investing activities (9,608) (5,148) FINANCING ACTIVITIES Payment of dividends on common stock (3,060) (2,795) Reduction of long-term debt (62) (8,299) Proceeds from issuance of medium-term notes - 26,675 Proceeds from equity infusion from parent - 10,000 Net advances from affiliates 17,346 6,925 Net change in short-term debt (2,000) (1,000) Net cash provided by financing activities 12,224 31,506 Net change in cash and cash equivalents 1,235 1,441 Cash and cash equivalents at beginning of period 156 480 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,391 $1,921 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, 1994, 1993, and 1992 included in the 1994 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 an Alabama utility, Alagasco is subject to regulation by the APSC which, in 1983, established the Rate Stabilization and Equalization (RSE) rate- setting process. RSE was extended for the third time on December 3, 1990, for a three-year period. Under the terms of that extension, RSE shall continue after November 30, 1993, unless, after notice to the Company, the Commission votes to either modify or discontinue its operation. On October 4, 1993, the Commission unanimously voted to extend RSE until such time as certain hearings mandated by the Energy Policy Act of 1992 (Energy Act) in connection with integrated resource planning management programs are completed. The Energy Act proceedings are expected to conclude during fiscal 1995 at which time it is expected that the Commission will begin reviewing Alagasco's RSE. No time table for review has yet been established. Under RSE as extended, the APSC conducts quarterly reviews to determine, based on Alagasco's projections and fiscal year-to-date performance, whether Alagasco's return on equity for the fiscal year will be within the allowed range of 13.15 percent to 13.65 percent. Reductions in rates can be made quarterly to bring the projected return within the allowed range; increases, however, are allowed only once each fiscal year, effective December 1, and cannot exceed 4 percent of prior-year revenues. RSE limits the utility's equity upon which a return is permitted to 60 percent of total capitalization and provides for certain cost control measures designed to monitor the Company's operations and maintenance (O&M) expense. If O&M expense per customer falls within 1.25 percentage points above or below the Consumer Price Index For All Urban Customers (index range), no adjustment is required. If, however, O&M expense per customer exceeds the index range, three-quarters of the difference will be returned to the customers. To the extent O&M expense per customer is less than the index range, the utility 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 remove the effect of departures from normal temperature on Alagasco's earnings. The calculation is performed monthly, and the adjustment to customers' bills is made in the same month the weather variation occurs. Under RSE as extended, a $1.1 million decrease in revenue became effective October 1, 1994, and a $5.2 million annual increase in revenue became effective December 1, 1994. The Company's rate schedules for natural gas distribution charges contained a Gas Supply Adjustment rider which permits the pass-through of changes in gas costs to customers and gas supply realignment surcharges imposed by the Company's suppliers resulting from changes in gas supply purchases related to the implementation of FERC Order 636. In accordance with APSC-directed regulatory accounting procedures, Alagasco in 1989 began returning excess utility deferred taxes which resulted from a reduction in the federal statutory tax rate from 46 percent to 34 percent using the average rate assumption method. This method provides for the return to ratepayers of excess deferred taxes over the lives of the related assets. In 1993 those excess taxes were reduced as a result of a federal tax rate increase from 34 percent to 35 percent. Approximately $3.1 million of remaining excess utility deferred taxes is being returned to ratepayers over approximately 16 years. 3. SUPPLEMENTAL CASH FLOW INFORMATION ENERGEN CORPORATION Three months ended December 31, (in thousands) 1994 1993 Interest paid, net of amounts capitalized $ 4,627 $ 3,753 Income taxes paid $ (51) $ 158 Noncash investing activities (capitalized depreciation and allowance for funds used during construction) $ 227 $ 122 Noncash financing activities (debt issuance costs) $ - $ 175 ALABAMA GAS CORPORATION Three months ended December 31, (in thousands) 1994 1993 Interest paid $ 4,305 $ 3,361 Income taxes paid $ 1,712 $ (185) Noncash investing activities (capitalized depreciation and allowance for funds used during construction) $ 227 $ 122 Noncash financing activities (debt issuance costs) $ - $ 175 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Consolidated net income for the first quarter was $2,736,000 ($0.25 per share) compared to $2,300,000 ($0.22 per share) in the prior year. The increase is due primarily to Alagasco earning its allowed return for the full three months on an increased level of equity resulting from last year's underground working storage gas investment. Partially offsetting this increase were Taurus's decreased contribution to consolidated earnings associated largely with lower natural gas prices and increased exploration expense, and the absence of contribution from W & J Propane that was sold during the third quarter of the prior year. Two factors created the majority of the 15 percent decrease in utility natural gas revenues for the quarter. The benefit of lower commodity cost of gas was passed through to customers in reduced rates. Additionally, warmer than normal weather resulted in an approximate 1.6 Bcf reduction in gas sales volumes to residential customers; partially offsetting that impact on revenues was the recovery of margins associated with departures from normal weather allowed under the APSC-approved weather normalization adjustment. A significant decrease in natural gas prices heavily influenced both operating fees and natural gas production revenues at Taurus. Operating fees on certain coalbed methane properties are impacted by a variety of factors including production volume, operating expenses and the price of natural gas, as defined by the operating agreements. The decrease in the current quarter's operating fees is attributable almost exclusively to a 27 percent decrease in the average index price of natural gas. With respect to gas production revenues, after giving effect to hedged volumes, the average sales price per Mcf was $1.81 compared to $2.02 in the prior year - a 10 percent decrease. Largely offsetting the price effect on those revenues was a 10 percent increase in production volumes. Oil production revenues were stable over the prior year as an increase in the average sales price per barrel ($15.84 for the current year compared to $15.04 in the prior year) was offset by slightly lower production volumes. To hedge its exposure to price fluctuations on oil and gas production, Taurus periodically enters into futures contracts. Under this program, Taurus has entered into contracts for the sale of 3.3 Bcf of its gas production with an average contract price of $1.95, and for the sale of 96,000 barrels of its oil production at an average contract price of $18.41 over the remainder of this fiscal year. While more than 50 percent of estimated gas production and over 90 percent of estimated oil production are hedged, 1995 earnings could decrease compared to 1994 due to the price risk associated with both unhedged production volumes and operating fees. The program has been extended into fiscal 1996 for the sale of 0.5 Bcf of gas production with an average contract price of $1.72. Other revenues for the quarter were significantly lower than those of the prior year due primarily to the absence of revenues from W & J Propane. Excluding the effect of propane revenues, other revenues would have decreased slightly as a result of lower merchandise sales. As with natural gas revenues, decreased commodity cost coupled with decreased sales volumes associated with warmer weather created a majority of the $12.3 million decrease in cost of gas for the quarter. Consolidated operations and maintenance (O&M) expense decreased 4 percent in the quarter due to the impact of the sale of propane operations in the prior year. Excluding the effect of propane operations, O&M expense would have increased 4 percent primarily due to increased labor and related expenses at Alagasco and increased exploration expense at Taurus . Depreciation expense for the quarter increased only slightly as the effects of normal plant growth at Alagasco and increased conventional production at Taurus were largely offset by the absence of depreciation on propane assets in the current year. 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. State and local business taxes are generally based on gross receipts of Alagasco and fluctuate accordingly. A significant reduction in short-term debt outstanding and the early repayment of certain long-term notes more than offset the effect of medium-term notes issued in December and January of the prior fiscal year resulting in a 5 percent decrease in interest expense. Other income was greater for the quarter largely due to the inclusion of redemption fees in the prior year related to the Company's refinancing of a significant portion of its long-term debt. Income tax expense for the quarter did not vary significantly as the effect of higher pretax net income was essentially offset by increased recognition of nonconventional fuel tax credits on an interim basis. The Company anticipates effective tax rates to remain lower than statutory rates through the year 2002 as it expects to recognize all 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 year. As more fully discussed in Note 2, Alagasco is subject to regulation by the APSC, which is expected to consider renewal of the utility's rate-setting mechanism following the completion of its review of certain mandates under the Energy Policy Act of 1992. Changes, if any, to the utility's present rate-setting assumptions or provisions could have an impact on its net income for 1995 and beyond. LIQUIDITY AND CAPITAL RESOURCES The item primarily responsible for the significant change in cash provided by (used in) operations was the prior year investment in underground storage working gas that totaled $22.3 million at December 31, 1993. Fluctuations in receivables and payables are generally the result of timing of payments. Net cash used in investing activities was primarily influenced by two factors. First, capital expenditures exceeded those of the prior year - Alagasco's due to the acquisition of the 2,200-customer gas system of Alabaster and Taurus's due to the planned expansion of its oil and gas development activities. Second, the inclusion in the prior year of proceeds related to the sale of equity securities served to reduce that quarter's cash used in investing activities. The change in net cash provided by (used in) financing activities is attributable to several occurrences in the first quarter of the prior year. The issuance of 550,000 shares of Energen common stock in November 1993 generated $13.5 million, and Alagasco issued $26.8 million in medium-term notes in December 1993. These proceeds were used to fund the investment in underground working storage gas, redeem its 8.75 percent debentures, reduce short-term debt outstanding, and to fund additional capital needs. Also during this quarter, 2,400 shares of Energen common stock were repurchased under the Company's stock repurchase program. FUTURE CAPITAL EXPENDITURES AND LIQUIDITY: Capital and exploration expenditures could approximate $66 million in fiscal 1995, excluding municipal gas system acquisitions, and primarily represent additions for normal distribution system expansion, the development of a new customer information system at Alagasco, and oil and gas development activities. With respect to oil and gas activities, the Company is attempting to invest a significant portion of its capital expenditures in proven property acquisitions. However, the market for acquisitions has been limited and the economics of current pricing has delayed exploration opportunities; therefore, capital expenditures may not reach targeted levels. In addition, Alagasco will maintain an investment in storage working gas which is anticipated to average $19 million for the fiscal year. The Company anticipates funding these capital requirements through internally generated capital and the utilization of short-term credit facilities. Energen has short-term credit facilities totaling $110 million available for working capital needs, with $2 million and $28 million outstanding at December 31, 1994 and 1993, respectively. SELECTED BUSINESS SEGMENT DATA Energen Corporation Three months ended December 31, (in thousands, except share data) 1994 1993 NATURAL GAS DISTRIBUTION Operating revenues Residential $44,350 $51,598 Commercial and industrial - small 15,545 19,112 Commercial and industrial - large 31 23 Transportation 7,566 7,808 Other (266) 452 Total $67,226 $78,993 Volumes sold and transported (thousands of Mcf) Residential 5,287 6,932 Commercial and industrial - small 2,466 3,073 Commercial and industrial - large 8 5 Transportation 14,290 13,168 Total 22,051 23,178 Other data Depreciation and amortization $ 4,737 $ 4,427 Capital expenditures $ 9,778 $ 5,336 Operating income $ 4,518 $ 3,152 OIL AND GAS EXPLORATION AND PRODUCTION Operating revenues Natural gas $ 3,948 $ 4,019 Oil 792 812 Other 1,191 1,370 Total $ 5,931 $ 6,201 Sales volume - natural gas (thousands of Mcf) 2,181 1,991 Sales volume - oil (thousands of barrels) 50 54 Average sales price - natural gas (per Mcf) $ 1.81 $ 2.02 Average sales price - oil (per barrel) $ 15.84 $ 15.04 Other data Depreciation, depletion and amortization $ 2,118 $ 1,955 Capital expenditures $ 3,007 $ 1,833 Exploration expenditures $ 429 $ 55 Operating income (loss) $ 1,154 $ 2,098 OTHER BUSINESS Operating revenues $ 2,416 $ 5,248 Depreciation and amortization $ 111 $ 329 Capital expenditures $ - $ 146 Operating income $ 204 $ 774 ELIMINATIONS AND CORPORATE EXPENSES Operating loss $ (440) $ (311) PART II. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a. Exhibits 27.1 Financial Data Schedule of Energen Corporation (for SEC purposes only) 27.2 Financial Data Schedule of Alabama Gas Corporation (for SEC purposes only) b. Reports on Form 8-K No reports on Form 8-K were filed for the three months ended December 31, 1994. (This page intentionally left blank.) 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 February 14, 1995 By/s/ Rex J. Lysinger Rex J. Lysinger Chairman of the Board and Chief Executive Officer February 14, 1995 By/s/ G. C. Ketcham G. C. Ketcham Executive Vice President, Chief Financial Officer and Treasurer February 14, 1995 By/s/ J. T. McManus J. T. McManus Vice President-Finance and Corporate Development of Energen and Vice President-Finance and Planning of Alagasco