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, 1997
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.
Exhibit index on page 10.
PARKER & PARSLEY 90-A, L.P.
TABLE OF CONTENTS
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets as of September 30, 1997 and
December 31, 1996 .................................... 3
Statements of Operations for the three and nine
months ended September 30, 1997 and 1996................. 4
Statement of Partners' Capital for the nine months
ended September 30, 1997................................. 5
Statements of Cash Flows for the nine months ended
September 30, 1997 and 1996.............................. 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
27. Financial Data Schedule
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,
1997 1996
------------ -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including interest
bearing deposits of $110,597 at September 30
and $102,316 at December 31 $ 110,817 $ 127,525
Accounts receivable - oil and gas sales 74,429 131,628
----------- -----------
Total current assets 185,246 259,153
----------- -----------
Oil and gas properties - at cost, based on the
successful efforts accounting method 5,066,728 5,053,096
Accumulated depletion (3,274,840) (3,165,751)
----------- -----------
1,791,888 1,887,345
----------- -----------
$ 1,977,134 $ 2,146,498
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 22,888 $ 18,703
Accounts payable - other - 32
----------- -----------
22,888 18,735
----------- -----------
Partners' capital:
Managing general partner 19,623 21,358
Limited partners (6,811 interests) 1,934,623 2,106,405
----------- -----------
1,954,246 2,127,763
----------- -----------
$ 1,977,134 $ 2,146,498
=========== ===========
The financial information included as of September 30, 1997 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,
--------------------- ---------------------
1997 1996 1997 1996
--------- --------- --------- ---------
Revenues:
Oil and gas $ 134,280 $ 165,659 $ 460,038 $ 533,375
Interest 1,739 1,901 5,517 5,015
-------- -------- -------- --------
136,019 167,560 465,555 538,390
-------- -------- -------- --------
Costs and expenses:
Oil and gas production 77,571 78,353 225,929 226,126
General and administrative 4,633 5,381 15,193 17,180
Depletion 34,757 33,014 109,089 132,122
Loss on disposition of assets - 13 - 28,717
-------- -------- -------- --------
116,961 116,761 350,211 404,145
-------- -------- -------- --------
Net income $ 19,058 $ 50,799 $ 115,344 $ 134,245
======== ======== ======== ========
Allocation of net income:
Managing general partner $ 190 $ 508 $ 1,153 $ 1,342
======== ======== ======== ========
Limited partners $ 18,868 $ 50,291 $ 114,191 $ 132,903
======== ======== ======== ========
Net income per limited
partnership interest $ 2.77 $ 7.38 $ 16.77 $ 19.51
======== ======== ======== ========
Distributions per limited
partnership interest $ 9.18 $ 13.03 $ 41.99 $ 38.36
======== ======== ======== ========
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, 1997 $ 21,358 $2,106,405 $2,127,763
Distributions (2,888) (285,973) (288,861)
Net income 1,153 114,191 115,344
------- --------- ---------
Balance at September 30, 1997 $ 19,623 $1,934,623 $1,954,246
======= ========= =========
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,
--------- ---------
1997 1996
--------- ---------
Cash flows from operating activities:
Net income $ 115,344 $ 134,245
Adjustments to reconcile net income to net
cash provided by operating activities:
Depletion 109,089 132,122
Loss on disposition of assets - 28,717
Changes in assets and liabilities:
(Increase) decrease in accounts receivable 57,199 (6,806)
Increase (decrease) in accounts payable 4,153 (10,620)
-------- --------
Net cash provided by operating activities 285,785 277,658
-------- --------
Cash flows from investing activities:
Additions to oil and gas properties (13,632) (1,189)
Proceeds from disposition of assets - 6,815
-------- --------
Net cash provided by (used in) investing
activities (13,632) 5,626
-------- --------
Cash flows from financing activities:
Cash distributions to partners (288,861) (264,111)
-------- --------
Net increase (decrease) in cash and cash equivalents (16,708) 19,173
Cash and cash equivalents at beginning of period 127,525 118,751
-------- --------
Cash and cash equivalents at end of period $ 110,817 $ 137,924
======== ========
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, 1997
(Unaudited)
Note 1. Basis of presentation
In the opinion of management, the unaudited financial statements of Parker &
Parsley 90-A, L.P. (the "Partnership") as of September 30, 1997 and for the
three and nine months ended September 30, 1997 and 1996 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 Partnership's Report on Form 10-K for the year ended
December 31, 1996, as filed with the Securities and Exchange Commission, a copy
of which is available upon request by writing to Rich Dealy, Vice President and
Controller, 303 West Wall, Suite 101, Midland, Texas 79701.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations (1)
As of August 8, 1997, Pioneer Natural Resources USA, Inc. ("Pioneer USA") became
the general partner of the Partnership. Prior to August 8, 1997, the
Partnership's general partner was Parker & Parsley Development L.P. ("PPDLP"), a
wholly-owned subsidiary of Parker & Parsley Petroleum Company ("Parker &
Parsley"). On August 7, 1997, Parker & Parsley and Mesa Inc. received
shareholder approval to merge and create Pioneer Natural Resources Company
("Pioneer"). On August 8, 1997, PPDLP was merged with and into Pioneer USA, a
wholly-owned subsidiary of Pioneer, resulting in Pioneer USA becoming the
general partner of the Partnership as PPDLP's successor by merger. For a more
complete description of the Parker & Parsley and Mesa Inc. merger, see Pioneer's
Registration Statement on Form S-4 as filed with the Securities and Exchange
Commission.
Results of Operations
Nine months ended September 30, 1997 compared with nine months ended
September 30, 1996
Revenues:
The Partnership's oil and gas revenues decreased 14% to $460,038 from $533,375
for the nine months ended September 30, 1997 as compared to the nine months
ended September 30, 1996. The decrease in revenues resulted from declines in
barrels of oil and mcf of gas produced and sold and a lower average price
7
received per barrel of oil, offset by an increase in the average price received
per mcf of gas. For the nine months ended September 30, 1997, 15,814 barrels of
oil were sold compared to 18,518 for the same period in 1996, a decrease of
2,704 barrels, or 15%. For the nine months ended September 30, 1997, 59,805 mcf
of gas were sold compared to 68,476 mcf for the same period in 1996, a decrease
of 8,671 mcf, or 13%. The production volume decreases were due to the decline
characteristics of the Partnership's oil and gas properties. Because of these
characteristics, management expects a certain amount of decline in production to
continue in the future until the Partnership's economically recoverable reserves
are fully depleted.
The average price received per barrel of oil decreased 4% from $20.60 for the
nine months ended September 30, 1996 to $19.76 for the same period ended
September 30, 1997, while the average price received per mcf of gas increased
11% from $2.22 during the nine months ended September 30, 1996 to $2.47 in 1997.
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 nine
months ended September 30, 1997.
Costs and Expenses:
Total costs and expenses decreased to $350,211 for the nine months ended
September 30, 1997 as compared to $404,145 for the same period in 1996, a
decrease of $53,934, or 13%. This decrease was due to declines in loss on
disposition of assets, depletion, general and administrative expenses ("G&A")
and production costs.
Production costs were $225,929 for the nine months ended September 30, 1997 and
$226,126 for the same period in 1996, resulting in a $197 decrease. The decrease
was due to a slight decline in production tax due to a decline in oil and gas
sales.
G&A's components are independent accounting and engineering fees and managing
general partner personnel and operating costs. During this period, G&A
decreased, in aggregate, 12% from $17,180 for the nine months ended September
30, 1996 to $15,193 for the same period in 1997.
Depletion was $109,089 for the nine months ended September 30, 1997 compared to
$132,122 for the same period in 1996, representing a decrease of $23,033, or
17%. This decrease was primarily attributable to a decline in oil production of
2,704 barrels for the nine months ended September 30, 1997 as compared to the
same period in 1996.
A loss on disposition of assets of $28,717 was recognized during the nine months
ended September 30, 1996. This loss was the result of the sale of one gas well
to Costilla Energy, L.L.C.
Three months ended September 30, 1997 compared with three months ended September
30, 1996
Revenues:
The Partnership's oil and gas revenues decreased 19% to $134,280 from $165,659
for the three months ended September 30, 1997 as compared to the three months
ended September 30, 1996. The decrease in revenues resulted from a decrease in
8
the average price received per barrel of oil and declines in barrels of oil and
mcf of gas produced and sold, offset by an increase in the average price
received per mcf of gas. For the three months ended September 30, 1997, 4,967
barrels of oil were sold compared to 5,618 for the same period in 1996, a
decrease of 651 barrels, or 12%. For the three months ended September 30, 1997,
20,190 mcf of gas were sold compared to 21,755 for the same period in 1996, a
decrease of 1,565 mcf, or 7%. The decreases in production volumes were due to
the decline characteristics of the Partnership's oil and gas properties.
The average price received per barrel of oil decreased $3.31, or 15%, from
$21.59 for the three months ended September 30, 1996 to $18.28 for the same
period in 1997, while the average price received per mcf of gas increased 5%
from $2.04 during the three months ended September 30, 1996 to $2.15 in 1997.
Costs and Expenses:
Total costs and expenses increased to $116,961 for the three months ended
September 30, 1997 as compared to $116,761 for the same period in 1996, an
increase of $200. This increase was due to additional depletion expense, offset
by declines in production costs, G&A and loss on disposition of assets.
Production costs were $77,571 for the three months ended September 30, 1997 and
$78,353 for the same period in 1996 resulting in a $782 decrease. The decrease
was due to lower well maintenance costs.
G&A's components are independent accounting and engineering fees and managing
general partner personnel and operating costs. During this period, G&A
decreased, in aggregate, 14% from $5,381 for the three months ended September
30, 1996 to $4,633 for the same period in 1997.
Depletion was $34,757 for the three months ended September 30, 1997 compared to
$33,014 for the same period in 1996, representing an increase of $1,743, or 5%,
primarily attributable to a decline in oil reserves during 1997 as a result of
lower commodity prices, offset by a decline in oil production of 651 barrels.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities increased $8,127 during the nine
months ended September 30, 1997 from the same period ended September 30, 1996.
This increase was primarily due to a decrease in G&A paid, offset by a decline
in oil and gas receipts and an increase in production costs paid.
Net Cash Provided by (Used in) Investing Activities
The Partnership's investing activities during the nine months ended September
30, 1997 and 1996 were for expenditures related to equipment replacement on
various oil and gas properties.
9
Proceeds from disposition of assets 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, 1997 to cover
distributions to the partners of $288,861 of which $2,888 was distributed to the
managing general partner and $285,973 to the limited partners. For the same
period ended September 30, 1996, cash was sufficient for distributions to the
partners of $264,111 of which $2,868 was distributed to the managing general
partner and $261,243 to the limited partners.
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
27. Financial Data Schedule
(b) Reports on Form 8-K - 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: Pioneer Natural Resources USA, Inc.,
Managing General Partner
Dated: November 6, 1997 By: /s/ Rich Dealy
---------------------------------
Rich Dealy, Vice President and
Controller
11