U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1999
[ ] TRANSITION REPORT PURSUANT SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number 333-62167
Atlas-Energy for the Nineties-Public #7 Ltd.
(Name of small business issuer in its charter)
Pennsylvania 25-1814688
(State or other jurisdiction of ( I.R.S. Employer identification No.)
incorporated or organization)
311 Rouser Road, Moon Township, Pennsylvania 15108
(Address of principal executive offices) (Zip Code)
Issuer's telephone (412) 262-2830
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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
Transitional Small Business Disclosure Format (check one):
Yes X No
- -----------------------------------------------------------------------------
PART I
Item 1. Financial Statements
The unaudited Financial Statements of Atlas-Energy for the Nineties-Public
#6 Ltd. (the "Partnership") for the period January 1, 1999 to June 30, 1999
Item 2. Description of Business
The Partnership has placed into production 57.5 net wells to
the Clinton/Medina formation in Mercer and Lawrence counties, Pennsylvania
and Stark and Trumbull counties in Ohio. As of June 30, 1999, all 57.5
net wells are in production. The first quarterly distribution was on
July 10, 1999 for natural gas production during January, February, March
and April, 1999.
Natural gas sales revenue for the three months was $507,244 which includes
landowner royalties. Expenses for this period include $75.00 per month
per well for administrative costs and $275.00 per month per well for pumpers
fees.
For the next twelve months management believes that the Partnership has
adequate capital. No other wells will be drilled and, therefore, no
additional funds will be required.
Although management does not anticipate that the Partnership will have to
do so, any additional funds which may be required will be obtained from
production revenues from Partnership wells or from borrowings by the
Partnership from Atlas or its affiliates, although Atlas is not
contractually committed to make such a loan. No borrowings will be
obtained from third parties.
PART II
Item 1. Legal Proceeding
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Securities Holders
None
Item 5. Other Matters
None
Item 6. Reports on Form 8-K
The registrant filed no reports on Form 8-K during the last
quarter of the period covered by this report.
- -----------------------------------------------------------------------------
UNAUDITED FINANCIAL STATEMENTS
ATLAS-ENERGY FOR THE NINETIES--PUBLIC #7 LTD.
A PENNSYLVANIA LIMITED PARTNERSHIP
BALANCE SHEET
As of June 30, 1999 and December 31, 1998
BALANCE SHEET
ASSETS 06/30/99 12/31/98 Increase
(unaudited) (decrease)
Cash $ 89,385 $ - $ 89,385
Accounts receivable 425,029 29,592 395,437
------- ------- ---------
TOTAL CURRENT ASSETS 514,414 29,592 484,822
Oil and gas drilling contracts/leases
,net of accum. depl. & amort. 13,587,753 14,042,536 (454,783)
Organizational/syndication costs (note 3) -0- 1,798,253 (1,798,253)
---------- ---------- ----------
TOTAL ASSETS $14,102,167 $15,870,381 $(1,768,214)
========== ========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable $ 23,162 $ - $ 23,162
Partners' capital 14,079,005 15,870,381 (1,791,376)
---------- ---------- ----------
TOTAL LIABILITIES AND PARTNERS CAPITAL $14,102,167 $15,870,381 $(1,768,214)
========== ========== ==========
The notes to Financial Statements are an integral part of this statement.
- --------------------------------------------------------------------------
ATLAS-ENERGY FOR THE NINETIES--PUBLIC #7 LTD.
A PENNSYLVANIA LIMITED PARTNERSHIP
STATEMENT OF INCOME (Unaudited)
For the six months ended June 30, 1999 and 1998
Six Months Ended Second Quarter Ended
June 30, June 30,
1999 1998 1999 1998
------------------ -------------------
REVENUE
Natural gas sales $610,607 $- $507,244 $-
Interest Income 436 - 344 -
Total Revenue 611,043 - 507,588 -
EXPENSES
Well operating expense 96,587 - 82,214 -
Depletion and depreciation
of oil and gas wells and
leases 454,783 - 373,313 -
General and administ. fees 14,052 - 11,108 -
Professional fees 8,191 - 2,932 -
Amortiza. of organ/synd costs -0- - - -
Other 960 - 371 -
---------- ------- ------- -------
Total Expenses 574,573 - 469,938 -
---------- ------- ------- -------
Earnings before cumulative
effect of chg. in acctg.
principle 36,470 - 37,649 -
Cumulative effect of chg.
in acctg. principle(Note3) (1,798,253) -0- -0- -0-
----------- ------ -------- -------
Net Earnings (Loss) $(1,761,783) $ - $37,649 $ -
============ ========= ======== =========
The notes to Financial Statements are an integral part of this statement.
- -----------------------------------------------------------------------------
ATLAS-ENERGY FOR THE NINETIES--PUBLIC #7 LTD.
A PENNSYLVANIA LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS (UNAUDITED)
For the six months ended June 30, 1999 and 1998
Six Months Ended
June 30,
1999 1998
--------------------
Increase (Decrease) in Cash
Cash flows from operating activities
Net Earnings ($ 1,761,783) $-
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Cumulative effect of change in acctg. principle 1,798,253 -0-
Depletion and depreciation 454,783 0
Amortization of organizational/synd.costs -0- 0
(Increase) accounts receivable (395,437) 0
Increase in accounts payable 23,162 0
----------- ----------
Cash provided by operating activities 118,978 0
Cash flows used in financing activities:
Distributions to Partners (29,593) 0
---------- ---------
Net Increase in Cash 89,385 0
Cash at beginning of period 0 0
---------- ---------
Cash at end of period $ 89,385 $ 0
========== =========
The notes to Financial Statements are an integral part of this statement.
- -----------------------------------------------------------------------------
ATLAS-ENERGY FOR THE NINETIES--PUBLIC #7 LTD.
A PENNSYLVANIA LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL ACCOUNTS (Unaudited)
For the three months ended June 30, 1999
MANAGING
GENERAL OTHER
PARTNER PARTNERS TOTAL
BALANCE AT JANUARY 1, 1999 $3,852,439 $12,017,942 $15,870,381
Participation in revenue and expenses:
Net production revenues 159,346 354,674 514,020
Interest 135 301 436
Depletion and depreciation ( 66,594) ( 388,189) (454,783)
Amortization 0 0 0
Other costs ( 7,193) ( 16,010) (23,203)
----------- ---------- --------
Earnings before cumulative
effect of change in acctg.
principle 85,694 (49,224) 36,470
Cumulative effect of chg.
in acctg. principle (1,798,253) -0- (1,798,253)
Distributions 0 ( 29,593) (29,593)
----------- ----------- ----------
BALANCE AT June 30, 1999 $ 2,139,880 $11,939,125 $14,079,005
=========== ========== =============
The notes to Financial Statements are an integral part of this statement.
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
ATLAS-ENERGY FOR THE NINETIES--PUBLIC #7 LTD.
A PENNSYLVANIA LIMITED PARTNERSHIP
June 30, 1999
1. INTERIM FINANCIAL STATEMENTS
The financial statements as of June 30, 1999 and for the six months then
ended have been prepared by the management of the Partnership without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and
regulations, although the Partnership believes that the disclosures are
adequate to make the information presented not misleading. These financial
statements should be read in conjunction with the audited December 31, 1998
financial statements. In the opinion of management, all adjustments
(consisting of only normal recurring accruals) considered necessary for
presentation have been included.
2. SIGNIFICANT ACCOUNTING POLICIES
The Partnership uses the successful efforts method of accounting for oil
and gas activities. Costs to acquire mineral interests in oil and gas
properties and drill and equip wells are capitalized. Oil and gas
properties are periodically assessed and when unamortized costs exceed
expected future net cash flows, a loss is recognized by a charge to income.
Capitalized costs of oil and gas wells and leases are depreciated,
depleted and amortized by the unit of production method.
3. REPORTING ON THE COSTS OF START-UP ACTIVITIES
In 1998, the AICPA issued Statement of Position 98-5 ("SOP 98-5"), Reporting
on the Costs of Start-Up Activities. This statement requires costs of
start-up activities and organization costs, as defined, to be expensed as
incurred. The partnership was required to adopt the provisions of SOP 98-5
effective January 1, 1999 and as a result has written-off the unamortized
balance of Organizational/Syndication costs as of that date.
In its previously-filed Form 10QSB for the quarter ended March 31, 1999, the
Partnership incorrectly recorded the impact of the adoption of SOP 98-5 as a
direct charge to Partners' capital. Although the balance sheet at March 31,
1999 included in such Form 10QSB is correct, the Statement of Income for the
three months ended March 31, 1999 should have included the following captions
and amounts:
Loss before cumulative effect of change in acctg. principle $ (1,180)
Cumulative effect of change in accounting principle (1,798,253)
-----------
Net Los $ (1.799,433)
This non-cash charge has no effect on reported cash flows. No Organizational/
Syndication costs were recorded by the Partnership during the six months June
30, 1999.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATION
ATLAS-ENERGY FOR THE NINETIES-PUBLIC #7 LTD.
Management's discussion and analysis should be read in conjunction with the
financial statements and notes thereto.
Results of Operations
- ---------------------
Six Months Ended June 30, 1999
- -------------------------------------------
The Partnership commenced production in January, 1999. Natural gas sales
revenue for the six months ended June 30,1999 amounted to $610,607 based
on gas production of 324,844 Mcf. The average sales price for gas
production during this period was $2.15/Mcf.
Quarter Ended June 30, 1999
Natural gas sales revenue for the three months ended June 30, 1999 amounted to
$507,244. Gas production was 266,651 Mcf; and the average sales price was
$2.18/Mcf.
Financial Condition
- -------------------
Liquidity
- ---------
Cash provided by operating activities during the six months ended
June 30, 1999 results primarily from sales of natural gas. The
partnership's working capital increased from $29,592 at December 31, 1998
to $491,252 at June 30, 1999. The increase is attributable to the
commencement of natural gas production for new wells turned on-line
during the current quarter, which resulted in higher receivables in
connection with sales of gas produced.
Capital Resources
- -----------------
There were no new material commitments for capital expenditures during the
period and the Partnership does not expect any in the foreseeable future.
By (Signature and Title): /s/ James R. O'Mara
James R. O'Mara
President, Chief Executive Officer and a Director
Date: June 30, 1999
In Accordance with the Exchange Act, this report has been signed by the
following persons on behalf of the registrant and in the capacities and on
the dates indicated.
By (Signature and Title): /s/ James R. O'Mara
James R. O'Mara
President, Chief Executive Officer and a Director
Date: June 30, 1999
By (Signature and Title): /S/ Tony C. Banks
Tony C. Banks
Vice President and Chief Financial Officer
Date: June 30, 1999
- ------------------------------------------------------------------------
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 89,385
<SECURITIES> 0
<RECEIVABLES> 425,029
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 514,414
<PP&E> 14,042,536
<DEPRECIATION> (454,783)
<TOTAL-ASSETS> 14,102,167
<CURRENT-LIABILITIES> 23,162
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 14,102,167
<SALES> 698,491
<TOTAL-REVENUES> 698,928
<CGS> 87,885
<TOTAL-COSTS> 87,885
<OTHER-EXPENSES> 574,573
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 36,470
<INCOME-TAX> 0
<INCOME-CONTINUING> 36,470
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> (1,798,253)
<NET-INCOME> (1,761,783)
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