UNITED STATES
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 quarterly period ended March 31, 2001
Commission File No. 33-26097-07
PARKER & PARSLEY 90-B, L.P.
(Exact name of Registrant as specified in its charter)
Delaware 75-2329287
---------------------------------- ---------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1400 Williams Square West, 5205 N. O'Connor Blvd., Irving, Texas 75039
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(Address of principal executive offices) (Zip code)
Registrant's Telephone Number, including area code : (972) 444-9001
Not applicable
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes / x / No / /
PARKER & PARSLEY 90-B, L.P.
TABLE OF CONTENTS
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets as of March 31, 2001 and
December 31, 2000..................................... 3
Statements of Operations for the three months
ended March 31, 2001 and 2000.......................... 4
Statement of Partners' Capital for the three months
ended March 31, 2001................................... 5
Statements of Cash Flows for the three months
ended March 31, 2001 and 2000.......................... 6
Notes to Financial Statements............................ 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.................... 7
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K......................... 10
Signatures............................................... 11
2
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
BALANCE SHEETS
March 31, December 31,
2001 2000
------------ ------------
(Unaudited)
ASSETS
Current assets:
Cash $ 361,118 $ 364,895
Accounts receivable - oil and gas sales 573,575 568,283
----------- -----------
Total current assets 934,693 933,178
----------- -----------
Oil and gas properties - at cost, based on the
successful efforts accounting method 26,111,764 26,110,930
Accumulated depletion (21,972,352) (21,899,717)
----------- -----------
Net oil and gas properties 4,139,412 4,211,213
--------- ---------
$ 5,074,105 $ 5,144,391
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 78,664 $ 42,091
Partners' capital:
Managing general partner 49,958 51,027
Limited partners (32,264 interests) 4,945,483 5,051,273
----------- -----------
4,995,441 5,102,300
----------- -----------
$ 5,074,105 $ 5,144,391
=========== ===========
The financial information included as of March 31, 2001 has been prepared by
the managing general partner without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
3
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended
March 31,
-------------------------
2001 2000
---------- ----------
Revenues:
Oil and gas $1,151,858 $ 896,935
Interest 7,085 5,740
Gain on disposition of assets 5,357 5,487
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1,164,300 908,162
--------- ---------
Costs and expenses:
Oil and gas production 388,370 362,344
General and administrative 36,650 27,481
Depletion 72,635 72,621
--------- ---------
497,655 462,446
--------- ---------
Net income $ 666,645 $ 445,716
========= =========
Allocation of net income:
Managing general partner $ 6,666 $ 4,457
========= =========
Limited partners $ 659,979 $ 441,259
========= =========
Net income per limited partnership interest $ 20.46 $ 13.68
========= =========
The financial information included herein has been prepared by
the managing general partner without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
4
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
STATEMENT OF PARTNERS' CAPITAL
(Unaudited)
Managing
general Limited
partner partners Total
---------- ---------- ----------
Balance at January 1, 2001 $ 51,027 $5,051,273 $5,102,300
Distributions (7,735) (765,769) (773,504)
Net income 6,666 659,979 666,645
--------- --------- ---------
Balance at March 31, 2001 $ 49,958 $4,945,483 $4,995,441
========= ========= =========
The financial information included herein has been prepared by
the managing general partner without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
5
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended
March 31,
------------------------
2001 2000
---------- ----------
Cash flows from operating activities:
Net income $ 666,645 $ 445,716
Adjustments to reconcile net income to net
cash provided by operating activities:
Depletion 72,635 72,621
Gain on disposition of assets (5,357) (5,487)
Changes in assets and liabilities:
Accounts receivable (5,292) (1,964)
Accounts payable 36,573 7,992
--------- ---------
Net cash provided by operating activities 765,204 518,878
--------- ---------
Cash flows from investing activities:
Additions to oil and gas properties (834) (17,655)
Proceeds from disposition of assets 5,357 5,487
--------- ---------
Net cash provided by (used in) investing
activities 4,523 (12,168)
--------- ---------
Cash flows used in financing activities:
Cash distributions to partners (773,504) (488,299)
--------- ---------
Net increase (decrease) in cash (3,777) 18,411
Cash at beginning of period 364,895 311,017
--------- ---------
Cash at end of period $ 361,118 $ 329,428
========= =========
The financial information included herein has been prepared by
the managing general partner without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
6
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
March 31, 2001
(Unaudited)
Note 1. Organization and nature of operations
Parker & Parsley 90-B, L.P. (the "Partnership") is a limited partnership
organized in 1990 under the laws of the State of Delaware.
The Partnership engages in oil and gas development and production in Texas and
is not involved in any industry segment other than oil and gas.
Note 2. Basis of presentation
In the opinion of management, the unaudited financial statements of the
Partnership as of March 31, 2001 include all adjustments and accruals consisting
only of normal recurring accrual adjustments which are necessary for a fair
presentation of the results for the interim period. These interim results are
not necessarily indicative of results for a full year. Certain reclassifications
may have been made to the March 31, 2000 financial statements to conform to the
March 31, 2001 financial statement presentations.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted in this Form 10-Q pursuant to the rules and
regulations of the Securities and Exchange Commission. The financial statements
should be read in conjunction with the financial statements and the notes
thereto contained in the Partnership's Report on Form 10-K for the year ended
December 31, 2000, as filed with the Securities and Exchange Commission, a copy
of which is available upon request by writing to Rich Dealy, Vice President and
Chief Accounting Officer, 5205 North O'Connor Boulevard, 1400 Williams Square
West, Irving, Texas 75039-3746.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations(1)
Results of Operations
Revenues:
The Partnership's oil and gas revenues increased 28% to $1,151,858 for the three
months ended March 31, 2001 as compared to $896,935 for the same period in 2000.
The increase in revenues resulted from higher average prices received, offset by
a decline in production. For the three months ended March 31, 2001, 23,737
barrels of oil, 8,809 barrels of natural gas liquids ("NGLs") and 51,504 mcf of
gas were sold, or 41,130 barrel of oil equivalents ("BOEs"). For the three
months ended March 31, 2000, 24,387 barrels of oil, 10,810 barrels of NGLs and
42,382 mcf of gas were sold, or 42,261 BOEs.
7
The average price received per barrel of oil increased $1.56, or 6%, from $27.70
for the three months ended March 31, 2000 to $29.26 for the same period in 2001.
The average price received per barrel of NGLs increased $4.36, or 31%, from
$13.89 for the three months ended March 31, 2000 to $18.25 for the same period
in 2001. The average price received per mcf of gas increased 243% from $1.68
during the three months ended March 31, 2000 to $5.76 for the same period in
2001. The market price for oil and gas has been extremely volatile in the past
decade, and management expects a certain amount of volatility to continue in the
foreseeable future. The Partnership may therefore sell its future oil and gas
production at average prices lower or higher than that received during the three
months ended March 31, 2001.
Gains on disposition of assets of $5,357 and $5,487 recognized during the three
months ended March 31, 2001 and 2000, respectively, were from the sale of
equipment on one fully depleted well.
Costs and Expenses:
Total costs and expenses increased to $497,655 for the three months ended March
31, 2001 as compared to $462,446 for the same period in 2000, an increase of
$35,209, or 8%. The increase was due to increases in production costs, general
and administrative expenses ("G&A") and depletion.
Production costs were $388,370 for the three months ended March 31, 2001 and
$362,344 for the same period in 2000, resulting in a $26,026 increase, or 7%.
The increase was primarily due to higher production taxes associated with higher
oil and gas prices.
G&A's components are independent accounting and engineering fees and managing
general partner personnel and administrative costs. During this period, G&A
increased 33% from $27,481 for the three months ended March 31, 2000 to $36,650
for the same period in 2001, primarily due to a higher percentage of the
managing general partner's G&A being allocated (limited to 3% of oil and gas
revenues) as a result of increased oil and gas revenues and an increase in the
accrual for tax preparation fees.
Depletion was $72,635 for the three months ended March 31, 2001 as compared to
$72,621 for the same period in 2000, an increase of $14. The increase was
primarily due to downward revisions to proved reserves on several wells during
the three months ended March 31, 2001, offset by a reduction in the
Partnership's net depletable basis from charges taken in accordance with
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
("SFAS 121") during the fourth quarter of 2000 and a decline in oil production
of 650 barrels for the period ended March 31, 2001 compared to the same period
in 2000.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities increased $246,326 for the three
months ended March 31, 2001 from the same period in 2000. The increase was
primarily attributable to an increase of $256,268 in oil and gas sales receipts
and a reduction in working capital of $25,253, offset by increases in production
costs of $26,026 and G&A expenses of $9,169. The increase in oil and gas
8
receipts resulted from the increase in commodity prices during 2001 which
contributed an additional $259,260 to oil and gas receipts, offset by $2,992
resulting from the decline in production during 2001 as compared to the same
period in 2000. The increase in production costs was primarily due to increased
production taxes associated with higher oil and gas prices. The increase in G&A
was primarily due to a higher percentage of the managing general partner's G&A
being allocated (limited to 3% of oil and gas revenues) as a result of increased
oil and gas revenues and an increase in the accrual for tax preparation fees.
Net Cash Provided by (Used in) Investing Activities
The Partnership's principal investing activities for the three months ended
March 31, 2001 and 2000 were related to expenditures for upgrades of oil and gas
equipment on active properties.
Proceeds from disposition of assets of $5,357 and $5,487 received during the
three months ended March 31, 2001 and 2000, respectively, were derived from the
sale of equipment on one fully depleted well.
Net Cash Used in Financing Activities
For the three months ended March 31, 2001, cash distributions to the partners
were $773,504, of which $7,735 was distributed to the managing general partner
and $765,769 to the limited partners. For the same period ended March 31, 2000,
cash distributions to the partners were $488,299, of which $4,883 was
distributed to the managing general partner and $483,416 to the limited
partners.
Proposal to acquire partnerships
On April 17, 2001, Pioneer Natural Resources Company ("Pioneer") filed a
preliminary proxy statement/prospectus with the Securities and Exchange
Commission proposing an agreement and plan of merger among Pioneer, Pioneer
Natural Resources USA, Inc. ("Pioneer USA"), a wholly- owned subsidiary of
Pioneer, and the limited partners of 46 Parker & Parsley limited partnerships.
Each partnership that approves the agreement and plan of merger and the other
related merger proposals will merge with and into Pioneer USA, and the
partnership interests of each such partnership will be converted into the right
to receive cash and Pioneer common stock. Pioneer USA is the sole or managing
general partner of the partnerships. The Partnership is one of the 46 Parker &
Parsley limited partnerships being requested to approve the agreement and plan
of merger. The preliminary proxy statement/prospectus is non-binding and is
subject to, among other things, consideration of offers from third parties to
purchase any partnership or its assets, the majority approval of the limited
partnership interests in each partnership and the resolution of Securities and
Exchange Commission review comments. No solicitation will be made using
preliminary materials.
- ---------------
(1) "Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations" contains forward looking statements that involve
risks and uncertainties. Accordingly, no assurances can be given that the
actual events and results will not be materially different than the
anticipated results described in the forward looking statements.
9
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - none
(b) Reports on Form 8-K - none.
10
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
S I G N A T U R E S
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.
PARKER & PARSLEY 90-B, L.P.
By: Pioneer Natural Resources USA, Inc.
Managing General Partner
Dated: May 11, 2001 By: /s/ Rich Dealy
-----------------------------------
Rich Dealy, Vice President
and Chief Accounting Officer
11