UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
/ x / Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended March 31, 1996
or
/ / Transition Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the transition period from _______ to _______
Commission File No. 33-26097-05
PARKER & PARSLEY 90-A, L.P.
(Exact name of Registrant as specified in its charter)
Delaware 75-2329245
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
303 West Wall, Suite 101, Midland, Texas 79701
(Address of principal executive offices) (Zip code)
Registrant's Telephone Number, including area code : (915) 683-4768
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 / /
Page 1 of 9 pages.
-There are no exhibits-
PARKER & PARSLEY 90-A, L.P.
(A Delaware Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
BALANCE SHEETS
March 31, December 31,
1996 1995
------------ ------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including interest
bearing deposits of $111,498 at March 31
and $118,538 at December 31 $ 111,598 $ 118,751
Accounts receivable - oil and gas sales 82,179 67,632
----------- -----------
Total current assets 193,777 186,383
Oil and gas properties - at cost, based on the
successful efforts accounting method 5,246,054 5,246,047
Accumulated depletion (3,206,268) (3,154,493)
----------- -----------
Net oil and gas properties 2,039,786 2,091,554
----------- -----------
$ 2,233,563 $ 2,277,937
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 22,832 $ 41,576
Partners' capital:
Limited partners (6,811 interests) 2,188,629 2,213,917
Managing general partner 22,102 22,444
----------- -----------
2,210,731 2,236,361
----------- -----------
$ 2,233,563 $ 2,277,937
=========== ===========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
2
PARKER & PARSLEY 90-A, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended
March 31,
1996 1995
----------- -----------
Revenues:
Oil and gas sales $ 184,646 $ 182,544
Interest income 1,417 1,650
---------- ----------
Total revenues 186,063 184,194
Costs and expenses:
Production costs 75,168 88,111
General and administrative expenses 5,539 6,167
Depletion 51,775 119,589
Amortization of organization costs - 718
---------- ----------
Total costs and expenses 132,482 214,585
---------- ----------
Net income (loss) $ 53,581 $ (30,391)
========== ==========
Allocation of net income (loss):
Managing general partner $ 536 $ (297)
========== ==========
Limited partners $ 53,045 $ (30,094)
========== ==========
Net income (loss) per limited partnership
interest $ 7.79 $ (4.42)
========== ==========
Distributions per limited partnership interest $ 11.50 $ 13.07
========== ==========
The financial information included herein has been prepared
by management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
3
PARKER & PARSLEY 90-A, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL
(Unaudited)
Managing
general Limited
partner partners Total
----------- ----------- -----------
Balance at January 1, 1995 $ 32,653 $ 3,233,970 $ 3,266,623
Distributions (899) (89,047) (89,946)
Net loss (297) (30,094) (30,391)
---------- ---------- ----------
Balance at March 31, 1995 $ 31,457 $ 3,114,829 $ 3,146,286
========== ========== ==========
Balance at January 1, 1996 $ 22,444 $ 2,213,917 $ 2,236,361
Distributions (878) (78,333) (79,211)
Net income 536 53,045 53,581
---------- ---------- ----------
Balance at March 31, 1996 $ 22,102 $ 2,188,629 $ 2,210,731
========== ========== ==========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
4
PARKER & PARSLEY 90-A, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended
March 31,
1996 1995
----------- -----------
Cash flows from operating activities:
Net income (loss) $ 53,581 $ (30,391)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depletion and amortization 51,775 120,307
Changes in assets and liabilities:
Increase in accounts receivable (14,547) (4,804)
Increase (decrease) in accounts payable (18,487) 2,066
---------- ----------
Net cash provided by operating activities 72,322 87,178
Cash flows from investing activities:
Additions to oil and gas properties (264) (3,403)
Cash flows from financing activities:
Cash distributions to partners (79,211) (89,946)
---------- ----------
Net decrease in cash and cash equivalents (7,153) (6,171)
Cash and cash equivalents at beginning of period 118,751 116,292
---------- ----------
Cash and cash equivalents at end of period $ 111,598 $ 110,121
========== ==========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
5
PARKER & PARSLEY 90-A, L.P.
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
March 31, 1996
(Unaudited)
NOTE 1.
Parker & Parsley 90-A, L.P. (the "Registrant") is a limited partnership
organized in 1990 under the laws of the State of Delaware.
The Registrant engages primarily in oil and gas development and production in
the Spraberry Trend area of West Texas and is not involved in any industry
segment other than oil and gas.
NOTE 2.
In the opinion of management, the unaudited financial statements as of March 31,
1996 of the Registrant 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. However, these interim results are not
necessarily indicative of results for a full year.
The financial statements should be read in conjunction with the financial
statements and the notes thereto contained in the Registrant's Report on Form
10-K for the year ended December 31, 1995, as filed with the Securities and
Exchange Commission, a copy of which is available upon request by writing to
Steven L. Beal, Senior Vice President, 303 West Wall, Suite 101, Midland, Texas
79701.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations(1)
The Registrant was formed April 30, 1990. On January 1, 1995, Parker & Parsley
Development L.P. ("PPDLP"), a Texas limited partnership, became the sole
managing general partner of the Registrant, by acquiring the rights and assuming
the obligations of Parker & Parsley Development Company ("PPDC"). PPDLP acquired
PPDC's rights and obligations as managing general partner of the Registrant in
connection with the merger of PPDC, P&P Producing, Inc. and Spraberry
Development Corporation into MidPar L.P., which survived the merger with a
change of name to PPDLP. PPDLP has the power and authority to manage, control
and administer all Registrant affairs. The limited partners contributed
$6,811,000 representing 6,811 interests ($1,000 per interest) sold to a total of
525 limited partners.
Since its formation, the Registrant has invested $5,500,196 in various prospects
that were drilled in Texas. One well was sold in 1993. At March 31, 1996, the
Registrant had 26 producing oil and gas wells.
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Results of Operations
Revenues:
The Registrant's oil and gas revenues increased to $184,646 from $182,544 for
the three months ended March 31, 1996 and 1995, respectively. The increase in
revenues resulted from a 10% increase in the average price received per barrel
of oil and a 14% increase in the average price received per mcf of gas, offset
by a 10% decrease in barrels of oil produced and sold and a 7% decrease in mcf
of gas produced and sold. For the three months ended March 31, 1996, 6,676
barrels of oil were sold compared to 7,407 for the same period in 1995, a
decrease of 731 barrels. For the three months ended March 31, 1996, 25,893 mcf
of gas were sold compared to 27,989 for the same period in 1995, a decrease of
2,096 mcf. The decrease in production volumes was primarily due to the decline
characteristics of the Registrant's oil and gas properties. Management expects a
certain amount of decline in production to continue in the future until the
Registrant's economically recoverable reserves are fully depleted.
The average price received per barrel of oil increased $1.73 from $17.21 for the
three months ended March 31, 1995 to $18.94 for the same period in 1996 while
the average price received per mcf of gas increased from $1.97 during the three
months ended March 31, 1995 to $2.25 in 1996. 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 Registrant 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, 1996.
Costs and Expenses:
Total costs and expenses decreased to $132,482 for the three months ended March
31, 1996 as compared to $214,585 for the same period in 1995, a decrease of
$82,103, or 38%. This decrease was due to declines in production costs, general
and administrative expenses ("G&A"), depletion and amortization of organization
costs.
Production costs were $75,168 for the three months ended March 31, 1996 and
$88,111 for the same period in 1995 resulting in a $12,943 decrease, or 15%.
This decrease was primarily due to a decline in well repair and maintenance
costs.
G&A's components are independent accounting and engineering fees, computer
services, postage and managing general partner personnel costs. During this
period, G&A decreased, in aggregate, 10% from $6,167 for the three months ended
March 31, 1995 to $5,539 for the same period in 1996. The Partnership agreement
limits G&A to 3% of gross oil and gas revenues.
Depletion was $51,775 for the three months ended March 31, 1996 compared to
$119,589 for the same period in 1995. This represented a decrease in depletion
of $67,814, or 57%, primarily attributable to the adoption of the provisions of
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
effective for the fourth quarter of 1995 and the reduction of net depletable
basis resulting from the charge taken upon such adoption. Depletion is computed
7
property-by-property utilizing the unit-of-production method based upon the
dominant mineral produced, generally oil. Oil production decreased 731 barrels
for the three months ended March 31, 1996 from the same period in 1995, while
oil reserves of barrels were revised downward by 21,993 barrels, or 6%.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities decreased to $72,322 during the three
months ended March 31, 1996, a 17% decrease from the same period ended March 31,
1995. This decrease was due to a decline in oil and gas sales receipts and by an
increase in expenditures for production costs. The decrease in oil and gas sales
receipts was due to the decline in barrels of oil and mcf of gas produced and
sold. The increase in production cost expenditures was due to additional well
repair and maintenance costs incurred in an effort to stimulate well production.
Net Cash Used in Investing Activities
The Registrant's principal investing activities during the three months ended
March 31, 1996 were for repair and maintenance activity on various oil and gas
properties.
Net Cash Used in Financing Activities
Cash was sufficient for the three months ended March 31, 1996 to cover
distributions to the partners of $79,211 of which $78,333 was distributed to the
limited partners and $878 to the managing general partner. For the same period
ended March 31, 1995, cash was sufficient for distributions to the partners of
$89,946 of which $89,047 was distributed to the limited partners and $899 to the
managing general partner.
It is expected that future net cash provided by operating activities will be
sufficient for any capital expenditures and any distributions. As the production
from the properties declines, distributions are also expected to decrease.
- - ---------------
(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.
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - none
(b) Form 8-K - none
8
PARKER & PARSLEY 90-A, 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-A, L.P.
By: Parker & Parsley Development L.P.,
Managing General Partner
By: Parker & Parsley Petroleum USA, Inc.
("PPUSA"), General Partner
Dated: May 13, 1996 By: /s/ Steven L. Beal
-------------------------------------
Steven L. Beal, Senior Vice President
and Chief Financial Officer of PPUSA
9