<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter ended June 30, 1995 Commission file number 0-5426
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The Wiser Oil Company
---------------------
(Exact name of Registrant as Specified in its Charter)
Delaware 55-0522128
-------- ----------
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
8115 Preston Road, Suite 400, Dallas, Texas 75225
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(Address of Principal Executive Offices)(Zip Code)
Registrant's telephone number, including area code 214/265-0080
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NONE
----
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, and (2) has been subject to such filing
requirements for the past 90 days.
x
----- ----
Yes No
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the close of the period covered by this report.
Class Outstanding at June 30, 1995
------------ ----------------------------
$3 par value 8,939,368
<PAGE>
THE WISER OIL COMPANY
---------------------
PART I
FINANCIAL INFORMATION
---------------------
Item 1. Financial Statements
The consolidated condensed financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. The financial statements reflect all
adjustments which are, in the opinion of management, necessary to fairly present
such information. Although the Company believes that the disclosures are
adequate to make the information presented not misleading, certain information
and footnote disclosures, including significant accounting policies, normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. It is suggested that these condensed financial statements be read
in conjunction with the financial statements and the notes thereto, included in
the Company's latest annual report on Form 10-K.
2
<PAGE>
THE WISER OIL COMPANY
---------------------
CONSOLIDATED BALANCE SHEET
--------------------------
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
1995 1994
-------- ------------
Thousands of Dollars
<S> <C> <C>
ASSETS
- ------
Current Assets:
Cash and cash equivalents $ 433 $ 2,714
Accounts receivable 7,832 10,900
Inventories 1,423 1,144
Prepaid expenses 1,305 852
-------- --------
Total current assets 10,993 15,610
-------- --------
Marketable Securities,
at market value 27,824 27,337
-------- --------
Property, Plant and
Equipment, at cost:
Oil and gas properties
(successful efforts method) 262,643 250,156
Other properties 4,532 5,443
-------- --------
267,175 255,599
Accumulated depreciation,
depletion, and amortization (96,058) (88,228)
-------- --------
Net property, plant,
and equipment 171,117 167,371
-------- --------
Other Assets 465 473
-------- --------
$210,399 $210,791
======== ========
</TABLE>
The accompanying note is an integral part of these financial statements.
3
<PAGE>
THE WISER OIL COMPANY
---------------------
CONSOLIDATED BALANCE SHEET
--------------------------
(Unaudited)
<TABLE>
June 30, December 31,
1995 1994
-------- ------------
Thousands of Dollars
<S> <C> <C>
LIABILITIES AND
STOCKHOLDERS' EQUITY
- --------------------
Current Liabilities:
Accounts payable $ 7,997 $ 9,562
Accrued income taxes 448 1,518
Accrued liabilities 1,965 2,139
Current portion of debt 78 78
-------- --------
Total current liabilities 10,488 13,297
Long Term Debt 78,978 78,013
Deferred Benefit Cost 1,566 1,052
Deferred Income Taxes 13,569 13,002
-------- --------
Total liabilities 104,601 105,364
-------- --------
Stockholders' Equity:
Common Stock - $3 par value;
20,000,000 shares authorized;
9,115,572 shares issued 27,347 27,347
Paid-in capital 3,078 3,078
Retained earnings 61,144 62,414
Marketable securities
valuation adjustment 16,546 16,013
Foreign currency translation 412 (696)
Treasury stock of
176,204 shares, at cost (2,729) (2,729)
-------- --------
Total Stockholders' Equity 105,798 105,427
-------- --------
$210,399 $210,791
======== ========
</TABLE>
The accompanying note is an integral part of these financial statements.
4
<PAGE>
THE WISER OIL COMPANY
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CONSOLIDATED STATEMENT OF INCOME AND RETAINED EARNINGS
------------------------------------------------------
(Unaudited)
<TABLE>
<CAPTION>
For the For the
Three Months Ended Six Months Ended
June 30, June 30,
------------------ -----------------
1995 1994 1995 1994
-------- ------- -------- -------
Thousands of Dollars
(except per share amounts)
<S> <C> <C> <C> <C>
REVENUES:
Oil and condensate $ 9,059 $ 8,199 $18,364 $14,611
Natural gas 3,919 4,637 8,109 10,028
Dividend and interest 320 398 654 787
Security sale gains - - 2,443 -
Other 1,285 273 1,262 664
------- ------- ------- -------
14,583 13,507 30,832 26,090
------- ------- ------- -------
COSTS AND EXPENSES:
Production and operating 5,167 5,476 9,970 10,871
Purchased natural gas 171 207 320 412
Depreciation, depletion, and
amortization 4,973 4,104 9,971 8,378
Abandonments - 101 - 190
Exploration 1,491 577 2,625 937
General and administrative 2,138 1,547 4,112 3,206
Interest expense 1,417 654 2,757 1,171
------- ------- ------- -------
15,357 12,666 29,755 25,165
------- ------- ------- -------
INCOME (LOSS) BEFORE INCOME TAXES (774) 841 1,077 925
PROVISION (BENEFIT) FOR INCOME TAXES (54) 2 559 20
------- ------- ------- -------
NET INCOME (LOSS) (720) 839 518 905
Retained earnings -
beginning of period 62,758 56,174 62,414 57,002
Dividends paid (894) (894) (1,788) (1,788)
------- ------- ------- -------
RETAINED EARNINGS END OF PERIOD $61,144 $56,119 $61,144 $56,119
======= ======= ======= =======
AVERAGE OUTSTANDING SHARES 8,939 8,939 8,939 8,939
======= ======= ======= =======
EARNINGS (LOSS) PER SHARE $ (.08) $ .09 $ .06 $ .10
======= ======= ======= =======
CASH DIVIDENDS PER SHARE $ .10 $ .10 $ .20 $ .20
======= ======= ======= =======
</TABLE>
The accompanying note is an integral part of these financial statements.
5
<PAGE>
THE WISER OIL COMPANY
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CONSOLIDATED STATEMENT OF CASH FLOW
-----------------------------------
(Unaudited)
<TABLE>
<CAPTION>
For the Six Months Ended
------------------------
June 30, June 30,
1995 1994
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Thousands of Dollars
<S> <C> <C>
Cash Flow From Operating Activities:
Net income $ 518 $ 905
Adjustments to reconcile net income
to operating cash flow -
Depreciation and depletion 9,971 8,378
Deferred income taxes 290 (700)
Security & property sale gains
(before current income tax
expense effect of $267) (2,880) -
Foreign currency translation (31) -
Dry hole cost, abandonments and
lease impairments 1,964 729
-------- --------
Other Changes:
Accounts receivable 3,068 440
Inventories (279) (57)
Prepaid expenses (453) (421)
Other assets 8 3
Accounts payable (1,565) (1,105)
Income taxes, net (1,070) 679
Accrued liabilities (174) 441
Deferred benefit cost 514 54
-------- --------
Operating Cash Flow 9,881 9,346
-------- --------
Cash Flow From Investing Activities:
Additions to property, plant
and equipment (13,972) (59,000)
Proceeds from sales of property,
plant, and equipment 1,142 1,854
Proceeds from security sales 2,796 -
Dry hole cost (1,305) (39)
-------- --------
Investing Cash Flow (11,339) (57,185)
-------- --------
Cash Flow From Financing Activities:
Long term debt issued 4,000 52,000
Payment on long term debt (3,035) (2,231)
Dividends paid (1,788) (1,788)
-------- --------
Financing Cash Flow (823) 47,981
-------- --------
Net Increase (Decrease) in Cash (2,281) 142
Cash and Cash Equivalents at the
beginning of the period 2,714 3,499
-------- --------
Cash and Cash Equivalents at the
end of the period $ 433 $ 3,641
======== ========
</TABLE>
The accompanying note is an integral part of these financial statements.
6
<PAGE>
THE WISER OIL COMPANY
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Notes to Financial Statements
1) Certain reclassifications have been made to the 1994 financial
statements to conform with current year presentation.
2) On June 24, 1994, the Company acquired certain oil and gas
properties from Eagle Resources Ltd. for approximately $53 million
(U.S.). The purchase was funded with proceeds from the Company's
revolving credit agreement, and with existing cash and cash equivalents.
The purchase method of accounting has been followed with respect to the
acquisition. Results of the Eagle properties' operations have been
included in the Company's results of operations as of June 30, 1994.
For additional information see the Form 8-K issued on July 11, 1994.
Unaudited pro forma results of operations, as if the acquisition
took place at the beginning of 1994 are as follows (000's):
<TABLE>
<CAPTION>
Six Months Ended
----------------
June 30, 1994
----------------
<S> <C>
Revenues $36,776
Expenses 36,630
-------
Net Income $ 146
=======
Earnings per share $ .02
=======
</TABLE>
3) On January 1, 1995 The Wiser Oil Company adopted Statement of
Financial Accounting (SFAS) No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of". The
adoption of SFAS No. 121 did not have a material effect on the results
of operations.
7
<PAGE>
THE WISER OIL COMPANY
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Item 2. Management's Discussion and Analysis of Financial Conditions and
Results of Operations
CURRENT QUARTER COMPARED WITH THE SAME QUARTER OF THE PREVIOUS YEAR
Second quarter revenues for 1995 were $14.6 million as compared to $13.5
million in 1994, an increase of 8%. Oil and condensate sales of $9.1 million
in 1995 rose slightly from $8.2 million in 1994. U.S. operations decreased
$1.9 million and our Canadian operations, which had no impact during the
second quarter of 1994, added $2.8 million in 1995. Oil and condensate
volumes increased only 3% in 1995 comparatively; however, pricing increased
7% or $1.19 per barrel. Canadian operations added 172,000 barrels while U.S.
operations declined 150,000 barrels, due to property sales during the fourth
quarter of 1994. Natural gas sales of $3.9 million in the second quarter of
1995 were down from $4.6 million in 1994 or 15% for the quarter. Natural gas
volumes increased 20% to 3,034,000 MCF for the period, but were offset by a
significant drop in spot market pricing of 30% or $0.55 per MCF during the
second quarter of 1995. Canadian operations added 671,000 MCF while U.S.
operations declined 156,000 MCF; which was due mainly to property sales
during the fourth quarter of 1994. Dividends and interest income reflected
a decline of 20% as the Company has liquidated some of its stock portfolio.
The Company did not sell any securities during the second quarter of 1995.
Other income of $1.3 million in the second quarter of 1995 increased $1.0
million over the second quarter of 1994. The increase is due to an increase
of lease bonus income and gains recognized from properties sold during the
period.
Costs and expenses of $15.4 million compared to $12.7 million in the
same quarter of 1994 have increased $2.7 million or 18%. U.S. operations
costs and expenses declined $2.1 million or 17%. The Canadian subsidiary
accounted for additional costs and expenses of $4.8 million. Production and
operating expenses of $5.2 million in the second quarter of 1995 declined
$0.3 million from $5.5 million in 1994, as the Company is realizing the
efforts of the disposal of high-operating expense, marginal U.S. properties.
Canadian operations added $0.7 million in production and operating expenses,
while U.S. operations declined by $1.0 million. Purchased gas expense
declined 17% during the period as demand for volumes complimented by falling
natural gas prices also dropped. Depreciation, depletion and amortization
(DD&A) was $5.0 million in 1995 as compared to $4.1 million in 1994. DD&A
for U.S. operations actually declined 33% for the period; however, the
decline was offset by additional DD&A from our Canadian operations for 1995.
Exploration expenses increased $0.9 million in 1995 as dry hole expense in
the U.S. operations rose $0.4 million and the Canadian operations increased
$0.5 million. General and administrative (G&A) expenses of $2.1 million have
increased from $1.5 million or 28%. The increase in costs were due to
increased staffing for Wiser's Canadian subsidiary. Interest expense rose
$0.7 million in 1995 as Wiser increased its long term debt in order to fund
its Canadian acquisition.
8
<PAGE>
The Company realized a net loss of $0.7 million for the second quarter
of 1995 as compared to net income of $0.8 million for 1994. Our U.S.
operations recorded a net profit of $0.7 million for the period, but was
negatively impacted by a net loss from our Canadian subsidiary of $1.4
million. Results in Canada reflect three primary factors: substantial
interest expenses associated with the 100% financing of the acquired assets,
high initial depreciation, depletion, and amortization charges that include
amortization of acquisition costs associated with items such as probable
reserves that can not yet be recorded as assets, as well as tax and other
benefits which will be realized in the future.
9
<PAGE>
THE WISER OIL COMPANY
---------------------
SIX MONTHS ENDED JUNE 30, 1995 COMPARED WITH THE SAME PERIOD IN THE PREVIOUS
YEAR
Revenues for six months ended June 30, 1995 were $30.8 million, an
increase of 16%. Revenues from U.S. operations declined 9% as the full
effect of the property sales are being realized. Our Canadian subsidiary
accounted for an additional $7.2 million in revenue for the same period, as
its revenues had no impact for six months ended June 30, 1994. Oil and
condensate sales of $18.4 million were on the rise from $14.6 million a year
ago. The U.S. operations realized a 12% reduction in oil and condensate
revenue while the Canadian subsidiary contributed an additional $5.6 million.
Canadian operations added 354,000 barrels, while U.S. operations declined
278,000 barrels, due to property sales during the fourth quarter of 1994.
Natural gas sales fell in 1995 to $8.1 million from $10.0 million in 1994.
U.S. natural gas operations fell 35% while our Canadian subsidiary added
another $1.6 million. Canadian operations added 1,422,000 MCF, while U.S.
operations declined 714,000 MCF, which was due mainly to property sales
during the fourth quarter of 1994. Dividend and interest income decreased
$0.2 million as the Company continues its long range plans to liquidate its
stock portfolio. Security sale gains were $2.4 million in 1995. Other
income rose $0.6 million from $0.7 million in 1994.An increase of $0.4
million in U.S. lease bonus income accounted for the majority of this
increase.
Cost and expenses for the six months ending June 30, 1995 rose to $29.8
million as compared to $25.2 million in 1994. Production and operating
expenses declined $0.9 million from 1994 as U.S. operating expenses declined
$2.4 million or 21% and Canada added $1.5 million. Purchased natural gas
declined 22% for the time period as demand and pricing fell. Depreciation,
depletion and amortization (DD&A) of $10.0 million increased 19% or $1.6
million over the previous year. U.S. operations recorded a 31% drop in DD&A
during the first six months of 1995 while our Canadian operations contributed
an additional $4.2 million. Significant increase in exploration expense of
$1.7 million was due to increased dry hole expenses in the U.S. and Canada of
$0.6 million each. General and administrative expenses rose $0.9 million.
The increase in costs were due to increased staffing for Wiser's Canadian
subsidiary. The Company's $1.6 million rise in interest expense is mainly
due to the additional funds borrowed for the Canadian purchase.
Net income of $0.5 million for the first six months of 1995 fell $0.4
million as compared to 1994. U.S. operations recorded a $2.7 million profit
for the period while our Canadian subsidiary recorded a $2.2 million loss.
Results in Canada reflect three primary factors: substantial interest
expenses associated with the 100% financing of the acquired assets, high
initial depreciation, depletion, and amortization charges that include
amortization of acquisition costs associated with items such as probable
reserves that can not yet be recorded as assets, as well as tax and other
benefits which will be realized in the future.
10
<PAGE>
THE WISER OIL COMPANY
---------------------
PART II - OTHER INFORMATION
---------------------------
Items 1 through 6 under Part II are not applicable to the quarter ended
June 30, 1995.
SIGNATURES
----------
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.
THE WISER OIL COMPANY
-------------------------------------------
(Registrant)
Date August 11, 1995 ANDREW J. SHOUP, JR. (SIGNED)
------------------- -------------------------------------------
Andrew J. Shoup, Jr.
President and
Chief Executive Officer
Date August 11, 1995 LAWRENCE J. FINN (SIGNED)
------------------- -------------------------------------------
Lawrence J. Finn
Vice President Finance and
Chief Financial Officer
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<CASH> 433
<SECURITIES> 27,824
<RECEIVABLES> 7,832
<ALLOWANCES> 0
<INVENTORY> 1,423
<CURRENT-ASSETS> 10,993
<PP&E> 267,175
<DEPRECIATION> 96,058
<TOTAL-ASSETS> 210,399
<CURRENT-LIABILITIES> 10,488
<BONDS> 78,978
<COMMON> 27,347
0
0
<OTHER-SE> 3,078
<TOTAL-LIABILITY-AND-EQUITY> 210,399
<SALES> 16,183
<TOTAL-REVENUES> 30,832
<CGS> 10,290
<TOTAL-COSTS> 22,886
<OTHER-EXPENSES> 6,869
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,077
<INCOME-TAX> 559
<INCOME-CONTINUING> 518
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 518
<EPS-PRIMARY> .06
<EPS-DILUTED> .06
</TABLE>
