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 September 30, 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 11 pages.
-There are no exhibits-
PARKER & PARSLEY 90-A, L.P.
TABLE OF CONTENTS
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets as of September 30, 1996 and
December 31, 1995 .................................. 3
Statements of Operations for the three and nine
months ended September 30, 1996 and 1995............... 4
Statement of Partners' Capital for the nine months
ended September 30, 1996............................... 5
Statements of Cash Flows for the nine months ended
September 30, 1996 and 1995............................ 6
Notes to Financial Statements............................ 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.................... 8
Part II. Other Information........................................ 10
Signatures........................................... 11
2
PARKER & PARSLEY 90-A, L.P.
(A Delaware Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
BALANCE SHEETS
September 30, December 31,
1996 1995
----------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including interest
bearing deposits of $137,724 at September 30
and $118,538 at December 31 $ 137,924 $ 118,751
Accounts receivable - oil and gas sales 74,438 67,632
---------- ----------
Total current assets 212,362 186,383
---------- ----------
Oil and gas properties - at cost, based on the
successful efforts accounting method 5,052,860 5,246,047
Accumulated depletion (3,128,029) (3,154,493)
---------- ----------
1,924,831 2,091,554
---------- ----------
$ 2,137,193 $ 2,277,937
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 30,698 $ 41,576
Partners' capital:
Limited partners (6,811 interests) 2,085,577 2,213,917
Managing general partner 20,918 22,444
---------- ----------
2,106,495 2,236,361
---------- ----------
$ 2,137,193 $ 2,277,937
========== ==========
The financial information included as of September 30, 1996 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 OPERATIONS
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
1996 1995 1996 1995
--------- --------- --------- ----------
Revenues:
Oil and gas $ 165,659 $ 147,836 $ 533,375 $ 499,005
Interest 1,901 2,114 5,015 5,752
-------- -------- -------- --------
167,560 149,950 538,390 504,757
-------- -------- -------- --------
Costs and expenses:
Oil and gas production 78,353 80,147 226,126 251,618
General and administrative 5,381 5,897 17,180 16,853
Depletion 33,014 95,452 132,122 313,556
Loss on sale of assets 13 - 28,717 -
Amortization of organization - - - 957
-------- -------- -------- --------
116,761 181,496 404,145 582,984
-------- -------- -------- --------
Net income (loss) $ 50,799 $ (31,546) $ 134,245 $ (78,227)
======== ======== ======== ========
Allocation of net income (loss):
Managing general partner $ 508 $ (316) $ 1,342 $ (773)
======== ======== ======== ========
Limited partners $ 50,291 $ (31,230) $ 132,903 $ (77,454)
======== ======== ======== ========
Net income (loss) per limited
partnership interest $ 7.38 $ (4.58) $ 19.51 $ (11.37)
======== ======== ======== ========
Distributions per limited
partnership interest $ 13.03 $ 12.00 $ 38.36 $ 38.45
======== ======== ======== ========
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)
STATEMENT OF PARTNERS' CAPITAL
(Unaudited)
Managing
general Limited
partner partners Total
--------- ---------- ----------
Balance at January 1, 1996 $ 22,444 $2,213,917 $2,236,361
Distributions (2,868) (261,243) (264,111)
Net income 1,342 132,903 134,245
-------- --------- ---------
Balance at September 30, 1996 $ 20,918 $2,085,577 $2,106,495
======== ========= =========
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)
STATEMENTS OF CASH FLOWS
(Unaudited)
Nine months ended
September 30,
----------------------
1996 1995
--------- ---------
Cash flows from operating activities:
Net income (loss) $ 134,245 $ (78,227)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depletion and amortization 132,122 314,513
Loss on sale of assets 28,717 -
Changes in assets and liabilities:
(Increase) decrease in accounts receivable (6,806) 13,223
Increase (decrease) in accounts payable (10,620) 11,469
-------- --------
Net cash provided by operating activities 277,658 260,978
-------- --------
Cash flows from investing activities:
Additions to oil and gas properties (1,189) (5,095)
Proceeds from sale of assets 6,815 -
-------- --------
Net cash provided by (used in) investing
activities 5,626 (5,095)
-------- --------
Cash flows from financing activities:
Cash distributions to partners (264,111) (264,452)
-------- --------
Net increase (decrease) in cash and cash equivalents 19,173 (8,569)
Cash and cash equivalents at beginning of period 118,751 116,292
-------- --------
Cash and cash equivalents at end of period $ 137,924 $ 107,723
======== ========
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
6
PARKER & PARSLEY 90-A, L.P.
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
September 30, 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 Registrant's unaudited financial statements as
of September 30, 1996 and for the three and nine months ended September 30, 1996
and 1995 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 information and footnote disclosure 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 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.
Note 3.
A loss of $28,717 on sale of assets to Costilla Energy, L.L.C. was recognized
during the nine months ended September 30, 1996. This loss was the result of the
write-off of remaining capitalized well costs for one gas well of $35,532, less
proceeds received of $6,815.
7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations (1)
Results of Operations
Nine months ended September 30, 1996 compared with nine months ended September
30, 1995
Revenues:
The Registrant's oil and gas revenues increased to $533,375 from $499,005 for
the nine months ended September 30, 1996 and 1995, respectively, an increase of
7%. The increase in revenues resulted from a 19% increase in the average price
received per barrel of oil and a 15% increase in the average price received per
mcf of gas, offset by an 11% decline in barrels of oil produced and sold and a
15% decline in mcf of gas produced and sold. For the nine months ended September
30, 1996, 18,518 barrels of oil were sold compared to 20,876 for the same period
in 1995, a decrease of 2,358 barrels. For the nine months ended September 30,
1996, 68,476 mcf of gas were sold compared to 80,841 mcf for the same period in
1995, a decrease of 12,365 mcf. Of the decrease, 6,954 mcf, or 8%, was
attributable to the sale of one gas well. The remainder of the decrease, 5,411
mcf, or 7%, was 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 $3.34 from $17.26 for the
nine months ended September 30, 1995 to $20.60 for the same period ended
September 30, 1996 while the average price received per mcf of gas increased
from $1.72 during the nine months ended September 30, 1995 to $2.22 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 nine months ended
September 30, 1996.
Costs and Expenses:
Total costs and expenses decreased to $404,145 for the nine months ended
September 30, 1996 as compared to $582,984 for the same period in 1995, a
decrease of $178,839, or 31%. This decrease was due to declines in production
costs, depletion and amortization of organization costs, offset by increases in
general and administrative expenses ("G&A") and loss on sale of assets.
Production costs were $226,126 for the nine months ended September 30, 1996 and
$251,618 for the same period in 1995, resulting in a $25,492 decrease, or 10%.
The decrease was due to a decline in well repair and maintenance costs.
G&A's components are independent accounting and engineering fees and managing
general partner personnel costs. During this period, G&A increased, in
aggregate, 2% from $16,853 for the nine months ended September 30, 1995 to
$17,180 for the same period in 1996.
8
Depletion was $132,122 for the nine months ended September 30, 1996 compared to
$313,556 for the same period in 1995, representing a decrease of $181,434, or
58%. This decrease was primarily attributable to the following factors: (i) a
reduction in the Registrant'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" ("FAS 121"), (ii) a reduction in oil production of 2,358 barrels for the
nine months ended September 30, 1996 as compared to the same period in 1995, and
(iii) an increase in oil and gas reserves during the third quarter of 1996 as a
result of higher commodity prices.
A loss on sale of assets of $28,717 was recognized during the nine months ended
September 30, 1996. This loss was the result of the write-off of capitalized
well costs for one gas well of $35,532, less the proceeds received of $6,815.
Three months ended September 30, 1996 compared with three months ended September
30, 1995
Revenues:
The Registrant's oil and gas revenues increased to $165,659 from $147,836 for
the three months ended September 30, 1996 and 1995, respectively, an increase of
12%. The increase in revenues resulted from a 31% increase in the average price
received per barrel of oil and a 34% increase in the average price received per
mcf of gas, offset by a 14% decline in barrels of oil produced and sold and a
17% decline in mcf of gas produced and sold. For the three months ended
September 30, 1996, 5,618 barrels of oil were sold compared to 6,539 for the
same period in 1995, a decrease of 921 barrels. For the three months ended
September 30, 1996, 21,755 mcf of gas were sold compared to 26,329 for the same
period in 1995, a decrease of 4,574 mcf. Of the decrease, 1,622 mcf, or 6%, was
attributable to the sale of one gas well. The remainder of the decrease, 2,952
mcf, or 11%, was due to the decline characteristics of the Registrant's oil and
gas properties.
The average price received per barrel of oil increased $5.10 from $16.49 for the
three months ended September 30, 1995 to $21.59 for the same period in 1996
while the average price received per mcf of gas increased from $1.52 during the
three months ended September 30, 1995 to $2.04 in 1996.
Costs and Expenses:
Total costs and expenses decreased to $116,761 for the three months ended
September 30, 1996 as compared to $181,496 for the same period in 1995, a
decrease of $64,735, or 36%. This decrease was due to declines in production
costs, G&A and depletion.
Production costs were $78,353 for the three months ended September 30, 1996 and
$80,147 for the same period in 1995 resulting in a $1,794 decrease. The decrease
was 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,
9
9% from $5,897 for the three months ended September 30, 1995 to $5,381 for the
same period in 1996.
Depletion was $33,014 for the three months ended September 30, 1996 compared to
$95,452 for the same period in 1995, representing a decrease of $62,438, or 65%,
primarily attributable to the following factors: (i) a reduction in the
Registrant's net depletable basis from charges taken in accordance with FAS 121,
(ii) a reduction in oil production of 921 barrels for the three months ended
September 30, 1996 as compared to the same period in 1995, and (iii) an increase
in oil and gas reserves during the third quarter of 1996 as a result of higher
commodity prices.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities increased $16,680 during the nine
months ended September 30, 1996 from the same period ended September 30, 1995.
This increase was due to an increase in oil and gas receipts.
Net Cash Provided by (Used in) Investing Activities
The Registrant's investing activities during the nine months ended September 30,
1996 and 1995 were for expenditures related to equipment replacement on various
oil and gas properties.
Proceeds of $6,815 were received from the sale of one gas well during the nine
months ended September 30, 1996.
Net Cash Used in Financing Activities
Cash was sufficient for the nine months ended September 30, 1996 to cover
distributions to the partners of $264,111 of which $261,243 was distributed to
the limited partners and $2,868 to the managing general partner. For the same
period ended September 30, 1995, cash was sufficient for distributions to the
partners of $264,452 of which $261,892 was distributed to the limited partners
and $2,560 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
None.
10
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: November 12, 1996 By: /s/ Steven L. Beal
----------------------------------------
Steven L. Beal, Senior Vice President
and Chief Financial Officer of PPUSA
11