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 number 1-7627
WAINOCO OIL CORPORATION
(Exact name of registrant as specified in its charter)
Wyoming 74-1895085
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10000 Memorial Drive, Suite 600 77024-3411
Houston, Texas (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (713) 688-9600
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 ...
Registrant's number of common shares outstanding as of
November 14, 1996: 27,258,502
- ------------
<PAGE>
WAINOCO OIL CORPORATION
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 1996
INDEX
Page
Part I - Financial Information
Item 1. Financial Statements 1
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6
Part II - Other Information 14
Definitions of Terms
mcf = thousand cubic feet
mmcf = million cubic feet
bbl(s) = barrel(s)
bpd = barrels per day
mbbls = thousand barrels
mmcfe = million cubic feet equivalent
Equivalent information is based on British Thermal Units at a ratio of six mcf
of natural gas to one bbl of oil. All dollar amounts are expressed in United
States dollars unless otherwise indicated as Canadian dollars (C$).
- ------------
<PAGE>
Page 1
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
WAINOCO OIL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands except per share)
Nine Months Ended Three Months Ended
September 30, September 30,
1996 1995 1996 1995
--------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Revenues:
Refined products $ 282,010 $ 245,460 $ 106,669 $ 88,500
Oil and gas sales 12,561 19,664 3,981 5,384
Other 2,500 6,885 651 411
--------- ---------- ---------- ----------
297,071 272,009 111,301 94,295
--------- ---------- ---------- ----------
Costs and Expenses:
Refining operating costs 265,231 236,357 100,149 82,841
Oil and gas operating costs 3,630 7,617 1,264 2,191
Selling and general expenses 6,607 8,484 1,986 2,698
Depreciation, depletion and amortization 12,991 16,416 4,325 5,032
--------- ---------- ---------- ----------
288,459 268,874 107,724 92,762
--------- ---------- ---------- ----------
Operating Income 8,612 3,135 3,577 1,533
Interest Expense, Net 12,974 15,091 4,447 5,020
--------- ---------- ---------- ----------
Loss Before Income Taxes (4,362) (11,956) (870) (3,487)
Provision for Income Taxes 311 100 98 32
--------- ---------- ---------- ----------
Loss $ (4,673) $ (12,056) $ (968) $ (3,519)
========== ========== ========== ==========
Loss Per Share $ (.17) $ (.44) $ (.04) $ (.13)
========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
Page 2
<TABLE>
<CAPTION>
WAINOCO OIL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands except shares)
September 30, 1996 and December 31, 1995 1996 1995
---------- ----------
<S> <C> <C>
ASSETS
Current Assets:
Cash, including cash equivalents of
$603 in 1996 and $1,000 in 1995 $ 3,462 $ 6,045
Trade receivables 24,525 20,022
Joint operator and other receivables 2,863 2,345
Inventory of crude oil, products and other 28,734 19,736
Other current assets 390 708
---------- ----------
Total current assets 59,974 48,856
---------- ----------
Property and Equipment, at cost:
Oil and gas properties, on a full-cost basis 170,127 164,711
Refinery and pipeline 140,510 137,598
Furniture, fixtures and other equipment 4,600 4,416
---------- ----------
315,237 306,725
Less - Accumulated depreciation, depletion
and amortization 135,590 122,404
---------- ----------
179,647 184,321
Other Assets 4,824 5,205
---------- ----------
$ 244,445 $ 238,382
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 36,691 $ 35,909
Oil and gas proceeds payable 1,290 2,705
Accrued interest 3,518 5,230
Accrued turnaround cost 6,249 882
Other accrued liabilities 4,015 6,615
---------- ----------
Total current liabilities 51,763 51,341
---------- ----------
Long-Term Debt, net of current maturities:
Revolving credit facilities 11,200 -
12% Senior Notes 94,000 92,000
7 % Convertible Subordinated Debentures 46,000 46,000
10 % Subordinated Debentures 7,415 7,377
---------- ----------
158,615 145,377
---------- ----------
Deferred Credits and Other 3,713 6,782
Deferred Income Taxes 2,418 2,418
Commitments and Contingencies
Shareholders' Equity:
Preferred stock, $100 par value, 500,000 shares
authorized, no shares issued - -
Common stock, no par, 50,000,000 shares authorized,
27,313,502 shares issued 57,172 57,172
Paid-in capital 81,767 81,767
Retained earnings (deficit) (102,702) (98,029)
Cumulative translation adjustment (8,053) (8,187)
Treasury stock, 55,000 and 57,500 shares
in 1996 and 1995,respectively (248) (259)
---------- ----------
Total Shareholders' Equity 27,936 32,464
---------- ----------
$ 244,445 $ 238,382
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
Page 3
<TABLE>
<CAPTION>
WAINOCO OIL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
For the nine months ended September 30, 1996 1995
---------- ----------
<S> <C> <C>
OPERATING ACTIVITIES
Loss $ (4,673) $ (12,056)
Depreciation, depletion and amortization 12,991 16,416
Gain on sale of interest in gas marketing company - (1,780)
Deferred credits and other 806 (60)
---------- ----------
9,124 2,520
Change in working capital from operations (15,079) (2,509)
---------- ----------
Net cash (used in) provided by operating activities (5,955) 11
INVESTING ACTIVITIES
Additions to property and equipment (10,602) (14,419)
Sales of oil and gas properties 921 13,516
Sale of interest in gas marketing company - 1,824
Net cash received (distributed) as operator of properties 176 (174)
---------- ----------
Net cash (used in) provided by investing activities (9,505) 747
FINANCING ACTIVITIES
Long-term borrowings -
Bank debt 20,343 33,700
12% Senior Notes 2,000 -
Repayments of long-term bank debt (9,143) (38,000)
Other (329) (437)
---------- ----------
Net cash provided by (used in) financing activities 12,871 (4,737)
Effect of exchange rate changes on cash 6 (22)
---------- ----------
Decrease in Cash and Cash Equivalents (2,583) (4,001)
Cash and Cash Equivalents, beginning of period 6,045 5,831
---------- ----------
Cash and Cash Equivalents, end of period $ 3,462 $ 1,830
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
Page 4
WAINOCO OIL CORPORATION AND SUBSIDIARIES
NOTES TO INTERIM FINANCIAL STATEMENTS
September 30, 1996
(Unaudited)
1. Financial statement presentation and earnings per share
Financial statement presentation
The condensed consolidated financial statements include the accounts of
Wainoco Oil Corporation, a Wyoming Corporation, and its wholly owned
subsidiaries, including Frontier Holdings Inc. ("Frontier" or the
"Refinery") and Wainoco Oil & Gas Company, collectively referred to as
Wainoco or the Company. These financial statements have been prepared by
the registrant without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission (SEC) and include all adjustments
(comprised of only normal recurring adjustments) which are, in the opinion
of management, necessary for a fair presentation. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although
Wainoco believes that the disclosures are adequate to make the information
presented not misleading. It is suggested that the financial statements
included herein be read in conjunction with the financial statements and
the notes thereto included in Wainoco's annual report on Form 10-K for the
year ended December 31, 1995.
Earnings per share
Primary and fully diluted earnings per share have been computed on the
weighted average number of common shares outstanding and assume the
exercise of stock option shares for the three and nine month periods ended
September 30, 1996 and 1995. No effect was given for the addition of
dilutive stock options for the three or nine month periods ended September
30, 1996 and 1995 as losses were incurred. The primary and fully diluted
average shares outstanding for the three months and nine months ended
September 30, 1996 were 27,258,502 and 27,256,841 and in 1995 were
27,256,002 and 27,253,174, respectively.
2. Schedule of major components of inventory
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
------------- ------------
(in thousands)
<S> <C> <C>
Crude oil $ 5,595 $ 2,517
Unfinished products 6,481 4,016
Finished products 9,518 6,629
Chemicals and in-transit inventory 1,130 1,060
Repairs and maintenance supplies and other 6,010 5,514
---------- ----------
$ 28,734 $ 19,736
========== ==========
</TABLE>
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<PAGE>
Page 5
3. Accounting policy for oil and gas properties
Wainoco follows the accounting policy (commonly referred to as
"full-cost" accounting) of capitalizing costs incurred in the acquisition,
exploration and development of oil and gas reserves. No gains or losses
are recognized upon the sale or disposition of oil and gas properties,
except for significant transactions.
Wainoco computes the provision for depreciation, depletion and
amortization (DD&A) of oil and gas properties, by country, on a quarterly
basis using the composite unit-of-production method based on future gross
revenue attributable to proved reserves.
Capitalized oil and gas property costs, by country, are limited to the
present value of future net income from estimated production of proved oil
and gas reserves discounted at 10%, plus the value of unproved properties.
As of September 30, 1996, the present value of future net income from
estimated Canadian oil and gas proved reserves exceeded the limitation on
capitalized property costs. Future price declines, if any, might require
Wainoco to provide additional provisions for DD&A in future periods.
4. Restructuring of operations
In the third quarter of 1994, Wainoco announced its intention to cease
all exploration in the United States and sell its United States oil and gas
assets. During 1995, Wainoco completed the sales process and ended its
production activities in the United States. In the fourth quarter of 1995,
Wainoco accrued restructuring losses of $1.7 million, net of a $.7 million
property disposition gain. With respect to the restructuring loss, during
the nine months ended September 30, 1996, the Company paid liabilities of
approximately $1.6 million, reduced related accruals of $93,000 (which
together with the reduction of other accruals resulted in other income of
$987,000) and has a remaining restructuring accrual approximating $.7
million.
5. Nonrecurring transactions
In 1996, other income includes $987,000 due to the reduction of certain
accruals associated with the disposition of United States oil and gas
operations.
In the first quarter of 1995 the Company received $856,000 in
settlement of a Frontier contract dispute. During the second quarter of
1995 the Company's Canadian operations sold its 9.9% interest in a Canadian
gas marketing company for a net gain of $1,780,000. Additionally, during
the second quarter of 1995 the Company's United States oil and gas
operations recorded $2,206,000 resulting from the settlement of a breach of
contract claim against a former gas purchaser. All such amounts have been
classified as other income in the Consolidated Statement of Operations.
- ----------
<PAGE>
Page 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Nine months ended September 30, 1996 compared with the same period in 1995
The Company had a loss for the nine months ended September 30, 1996 of
$4,673,000, or $.17 per share, compared to a loss of $12,056,000, or $.44
per share, for the same period in 1995. Operating income increased
$5,477,000 or 175% in 1996 to $8,612,000, attributable to an increase in
refining operating income of $6,649,000, offset by a decrease in Canadian
oil and gas operating income of $1,185,000.
In 1996, other income decreased $4,385,000 to $2,500,000. Other income
in 1996 includes $987,000 due to the reduction of certain accruals
associated with the disposition of United States oil and gas operations.
Other income for the first nine months of 1995 included $856,000 received
in settlement of a contract dispute which was included in refining
operating income; the sale by the Canadian oil and gas operations of its
interest in a Canadian gas marketing company for a net gain of $1,780,000;
and the United States oil and gas operations settlement of a breach of
contract claim against a former gas purchaser in amount of $2,206,000.
Refining operating income increased in 1996 versus 1995 due to an
increase in refined product revenues partially offset by an increase in
refining operating costs. Refined products revenues increased $36,550,000
or 15% due to a $3.12 per bbl or 14% increase in average product sales
prices. Refined product sales volumes were flat to 1995 levels. The
refined product spread improved $.60 per bbl to $4.65 per bbl in 1996 as a
result of an increase in average product sales prices exceeding the
increase in material costs for gasoline and especially distillates. Lower
national distillate inventory levels in 1996 contributed to the improvement
in distillate selling price. Yields of gasoline increased 3% in 1996,
while distillate yields were unchanged from the same period in 1995.
Refining operating costs increased $28,874,000 or 12% over 1995 levels
primarily as a result of an increase in material costs offset by a decrease
in refinery operating expense. Material costs increased approximately 14%
or $2.52 per bbl in 1996 due to a general oil price increase.
Additionally, the sweet/sour spread declined 18% to average $2.54 per bbl
in 1996, as a result of the increased competition for Wyoming sour crude
oil and the alternate sour crudes. During the first nine months of 1996,
the refinery increased its use of sour crude by 17% which favorably
impacted material costs. The sour crude utilization rate expressed as a
percent of total crude increased from 75% in 1995 to 85% in 1996. Refinery
operating expense decreased $.10 per bbl to $3.13 per bbl in 1996 as a
result of Frontier's recovery in the first quarter of 1996 of
approximately $1.3 million of repair costs related to a pipeline gas
explosion in 1995. The repair costs approximating $1.3 million in 1995,
and related recovery in 1996, were both included in refinery operating
expense. The strike by approximately 150 union employees which commenced
May 8, 1996 and settled July 29, 1996 did not adversely impact operating
costs or throughput.
Oil and gas revenues decreased $7,103,000 or 36% in the first nine months
of 1996 due to the disposition in 1995 of oil and gas operations in the
United States (1995 - $6,121,000, 1996 - $nil), and a 7% decrease in
Canadian oil and gas revenues of $982,000 in 1996.
The decrease in Canadian oil and gas operating income for the nine months
ended September 30, 1996 was due to a decrease in Canadian oil and gas
revenues offset by decreased Canadian operating costs versus 1995 and by
the gain from sale of its interest in a Canadian gas marketing company of
$1,780,000 reflected in 1995. In 1996, Canadian oil revenue increased 48%
over 1995 levels to $4,198,000 as a result of a 28% increase in sales
volumes and a 16% increase in average oil price. The average price
increase was attributable to an increase in the price of crude oil,
together with an increase in the weighting of oil versus natural gas
liquids in 1996 due in part to nine months production in 1996 from the
Company's oil discoveries made throughout 1995. In the first nine months
of 1996, Canadian gas revenue decreased $2,340,000 or 22%, attributable to
a 21% decrease in sales volume and a 1% decrease in gas price from 1995.
The gas sales volume decline in 1996 was attributable to curtailment and
disposition of certain non-core high operating cost properties subsequent
to September 30, 1995, production declines and various operating problems
by a major third party gas processing and transmission company in 1996.
Oil and gas operating costs decreased $3,987,000 or 52% in the first nine
months of 1996 of which $3,230,000 was related to discontinued United
States oil and gas operations. In Canada, operating costs decreased
$757,000 or 17% in 1996 due to various cost reduction factors including
production curtailment or disposition of abnormally high operating cost
areas, implementation of cost reduction procedures, and inclusion in 1996
of certain annual joint venture adjustments at areas operated by Wainoco.
- ----------
<PAGE>
Page 7
Selling and general expenses decreased $1,877,000 or 22% to $6,607,000
for the nine months ended September 30, 1996 primarily as a result of staff
reductions associated with disposition of United States oil and gas
operations and reassignment of certain corporate administrative functions
in late 1995. The nine months ended September 30, 1996 also includes
$235,000 of salary and related expense of certain United States employees
who were not retained subsequent to March 31, 1996. Refinery related
expenses decreased $392,000 or 11% from 1995 levels.
Depreciation, depletion and amortization decreased $3,425,000 or 21% in
the 1996 nine-month period as compared to the same period in 1995 of which
$2,705,000 related to discontinued United States oil and gas operations
included in 1995. In 1996, Canadian oil and gas DD&A decreased $1,227,000
or 17% as a result of a 10% decline in the average DD&A rate and lower oil
and gas revenues in the first nine months of 1996 versus 1995. In Canada,
the oil and gas DD&A rate as a percentage of sales decreased from 55% in
1995 to 50% in 1996, primarily as a result of oil reserves discovered
throughout 1995 and the improved oil price in 1996 versus 1995. Refining
DD&A increased $449,000 due to an increase in the refinery property and
equipment depreciable base from 1995 to 1996.
The interest expense decrease of $2,117,000 or 14% in 1996 was
attributable to the repayment of long term debt in late 1995 utilizing the
sale proceeds on disposition of the United States oil and gas properties.
Average long term debt for the first nine months decreased from $170
million in 1995 to $154 million in 1996.
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<PAGE>
Page 8
RESULTS OF OPERATIONS
Three months ended September 30, 1996 compared with the same period in 1995
The Company had a loss for the three months ended September 30, 1996 of
$968,000, or $.04 per share, compared to a loss of $3,519,000, or $.13 per
share, for the same period in 1995. Operating income increased $2,044,000
or 133% in 1996 to $3,577,000, attributable to increases in refining
operating income of $1,009,000 and Canadian oil and gas operating income of
$226,000. Additionally, disposition of the United States oil and gas
operations improved operating income by $409,000, and cost savings
attributable to the reassignment of certain corporate administrative
functions favorably impacted operating income by $400,000 in 1996 versus
1995.
In 1996, other income increased $240,000 to $651,000. Other income in
1996 includes $146,000 associated with the reduction of certain accruals
following the disposition of United States oil and gas operations.
Refining operating income increased in 1996 versus 1995 due to an
increase in refined product revenues partially offset by an increase in
refining operating costs. Refined products revenue increased $18,169,000
or 21% due to a $3.76 per bbl increase in average product sales prices and
a 3% increase in sales volumes in 1996. The refined product spread
increased $0.14 per bbl to $4.60 per bbl from 1995 levels. Yields of
gasoline and distillates increased 5% and 2% respectively from 1995 levels,
while crude charges increased 4%.
Refining operating costs increased $17,308,000 or 21% over 1995 levels
primarily as a result of an increase in material costs. Material costs
increased 20% or $3.62 per bbl in 1996 due to a general increase in oil
price, in spite of an 11,807 bpd or 54% improvement in the sour crude
utilization rate in 1996 versus 1995. The sour crude utilization rate in
the third quarter expressed as a percent of total crude increased from 59%
in 1995 to 87% in 1996. The sweet/sour spread declined 22% to average
$2.51 per bbl in 1996, as a result of the increased competition for Wyoming
sour crude oil and the alternate sour crudes. Refinery operating expense
per sales bbl remained relatively flat to 1995. The strike by
approximately 150 union employees which commenced May 8, 1996 and settled
July 29, 1996 did not adversely impact operating costs or throughput.
Oil and gas revenues decreased $1,403,000 or 26% in the third quarter of
1996 due to the disposition in 1995 of oil and gas operations in the United
States (1995 - $1,083,000, 1996 - $nil), and a 7% decrease in Canadian oil
and gas revenues of $320,000 in 1996.
The decrease in Canadian oil and gas operating income for the three
months ended September 30, 1996 is primarily due to a decline in gas
revenue. In the third quarter of 1996, Canadian oil revenue increased 46%
over 1995 levels to $1,468,000 as a result of a 35% increase in average oil
price and an 8% increase in sales volumes. The average price increase was
primarily attributable to an increase in the price of crude oil, together
with a slight increase in the weighting of oil versus natural gas liquids
in 1996 due in part to production from the Company's oil discoveries made
throughout 1995. In the third quarter of 1996, Canadian gas revenue
decreased $781,000 or 24%, attributable to a 17% decrease in sales volume
and an 8% decrease in gas price from 1995. The gas sales volume decline in
1996 was attributable to curtailment and disposition of certain non-core
high operating cost properties subsequent to September 30, 1995, production
declines, and various operating problems encountered by a major third party
gas processing and transmission company in 1996.
Oil and gas operating costs decreased $927,000 or 42% in the third
quarter of 1996 of which $627,000 was related to discontinued United States
oil and gas operations included in 1995. In Canada, operating costs
decreased $300,000 or 19% in 1996 due to various cost reduction factors
including implementation of cost reduction procedures and production
curtailment or disposition of abnormally high operating cost areas.
Selling and general expenses decreased $712,000 or 26% to $1,986,000 for
the three months ended September 30, 1996 primarily as a result of staff
reductions associated with disposition of United States oil and gas
operations and reassignment of certain corporate administrative functions
in late 1995.
Depreciation, depletion and amortization decreased $707,000 or 14% in the
1996 three-month period as compared to the same period in 1995 of which
$474,000 related to United States oil and gas operations included in 1995.
In 1996, Canadian oil and gas DD&A decreased $407,000 or 17% as a result of
lower oil and gas revenues in the third quarter of 1996 versus 1995 and a
decrease in the DD&A rate as a percentage of sales from 57% in 1995 to 51%
in 1996. The decreased DD&A rate was favorably impacted by increased oil
prices in 1996 versus 1995.
Interest expense decreased $573,000 or 11% in 1996 due to the repayment
of long term debt in late 1995 utilizing the sale proceeds from disposition
of the United States oil and gas properties. Average long term debt for
the third quarter decreased from $165 million in 1995 to $158 million in
1996.
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<PAGE>
Page 9
OPERATING EARNINGS BY SEGMENT
The following (in thousands) presents the operating income by operating
segment, by country for the nine months and three months ended September
30, 1996 and 1995. Operating income is income before net interest expense
and provision for income taxes and does not include unallocated net
corporate expenses of $1,756,000 and $2,059,000 in the nine months ended
September 30, 1996 and 1995, respectively, and $413,000 and $813,000 in the
three months ended September 30, 1996 and 1995, respectively. In 1995, the
Company completed disposition of its oil and gas assets located in the
United States, and accordingly the segmented information below reflects
only the oil and gas activity conducted in Canada.
<TABLE>
<CAPTION>
Oil and Gas
Refining Canada Total
---------- ---------- ----------
<S> <C> <C> <C>
Nine Months Ended September 30,
1996 - Operating margin $ 17,694 $ 9,529 $ 27,223
Selling and general expenses 3,133 1,776 4,909
Depreciation, depletion and amortization 6,707 6,226 12,933
---------- ---------- ----------
Operating income $ 7,854 $ 1,527 $ 9,381
========== ========== ==========
1995 - Operating margin $ 10,988 $ 11,888 $ 22,876
Selling and general expenses 3,525 1,723 5,248
Depreciation, depletion and amortization 6,258 7,453 13,711
---------- ---------- ----------
Operating income $ 1,205 $ 2,712 $ 3,917
========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
Oil and Gas
Refining Canada Total
---------- ---------- ----------
<S> <C> <C> <C>
Three Months Ended September 30,
1996 - Operating margin $ 6,890 $ 2,852 $ 9,742
Selling and general expenses 1,044 563 1,607
Depreciation, depletion and amortization 2,255 2,036 4,291
---------- ---------- ----------
Operating income $ 3,591 $ 253 $ 3,844
========== ========== ==========
1995 - Operating margin $ 5,878 $ 3,057 $ 8,935
Selling and general expenses 1,181 587 1,768
Depreciation, depletion and amortization 2,115 2,443 4,558
---------- ---------- ----------
Operating income $ 2,582 $ 27 $ 2,609
========== ========== ==========
</TABLE>
The 1996 segmented operating earnings disclosed above excludes other income
of $987,000 and $146,000 for the nine and three month periods ended
September 30, 1996 due to the reduction of certain accruals associated with
the disposition of United States oil and gas operations. The 1995
segmented operating earnings disclosed above excludes operating income of
$1,277,000 and an operating loss of $263,000 attributable to United States
oil and gas operations for the nine and three months ended September 30,
1995, respectively.
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<PAGE>
Page 10
<TABLE>
<CAPTION>
REFINING OPERATING STATISTICAL INFORMATION
Nine Months Ended Three Months Ended
September 30, September 30,
------------------- -------------------
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Raw material input (bpd)
Sweet crude 5,371 8,894 4,840 15,314
Sour crude 30,983 26,423 33,596 21,789
Other feed and blend stocks 5,016 4,730 5,282 4,106
-------- -------- -------- --------
Total 41,370 40,047 43,718 41,209
Manufactured product yields (bpd)
Gasoline 17,514 17,047 17,900 17,020
Distillates 13,289 13,279 13,129 12,817
Asphalt and other 8,986 8,213 11,243 9,752
-------- -------- -------- --------
Total 39,789 38,539 42,272 39,589
Total product sales (bpd)
Gasoline 20,627 20,789 21,613 21,430
Distillates 12,659 12,953 13,091 12,941
Asphalt and other 7,305 6,685 9,544 8,484
-------- -------- -------- --------
Total 40,591 40,427 44,248 42,855
Operating margin information (per sales bbl)
Average sales price $ 25.36 $ 22.24 $ 26.21 $ 22.45
Material costs (under FIFO inventory accounting) 20.71 18.19 21.61 17.99
-------- -------- -------- --------
Product spread 4.65 4.05 4.60 4.46
Operating expenses excluding depreciation 3.13 3.23 3.01 3.03
Depreciation .59 .55 .54 .52
-------- -------- -------- --------
Operating margin $ .93 $ .27 $ 1.05 $ .91
Manufactured product margin
before depreciation (per bbl) $ 1.50 $ .82 $ 1.59 $ 1.43
Purchase product margin (per purchased product bbl) $ 2.03 $ .97 $ 2.03 $ 2.06
Sweet/sour spread (per bbl) $ 2.54 $ 3.09 $ 2.51 $ 3.21
Average sales price (per sales bbl)
Gasoline $ 28.14 $ 25.14 $ 29.37 $ 25.16
Distillates 27.83 22.94 28.53 23.57
Asphalts and other 13.20 11.89 15.86 13.91
</TABLE>
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<PAGE>
Page 11
<TABLE>
<CAPTION>
OIL AND GAS EXPLORATION AND PRODUCTION STATISTICAL INFORMATION
Nine Months Ended Three Months Ended
September 30, September 30,
------------------- -------------------
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Oil and gas revenue (in thousands)
Net oil and condensate sales
Canada $ 4,198 $ 2,840 $ 1,468 $ 1,007
United States - 5,302 - 1,074
-------- -------- -------- --------
4,198 8,142 1,468 2,081
-------- -------- -------- --------
Net gas sales
Canada 8,363 10,703 2,513 3,294
United States - 819 - 9
-------- -------- -------- --------
8,363 11,522 2,513 3,303
-------- -------- -------- --------
$ 12,561 $ 19,664 $ 3,981 $ 5,384
======== ======== ======== ========
Production
Net oil and condensate (bbls)
Canada 252,000 197,000 78,000 72,000
United States - 332,000 - 73,000
-------- -------- -------- --------
252,000 529,000 78,000 145,000
======== ======== ======== ========
Net gas (mmcf)
Canada 9,374 11,848 2,918 3,532
United States - 497 - 1
-------- -------- -------- --------
9,374 12,345 2,918 3,533
======== ======== ======== ========
Price
Average oil and condensate sales (per bbl)
before deduction for production taxes
Canada $ 16.65 $ 14.40 $ 18.75 $ 13.92
United States - 15.98 - 14.79
Weighted average 16.65 15.39 18.75 14.36
Average gas sales (per mcf) before
deduction for production taxes
Canada $ .89 $ .90 $ .86 $ .93
United States - 1.65 - -
Weighted average .89 .93 .86 .93
C$/US$
Period end $ .7342 $ .7452 $ .7342 $ .7452
Average .7311 .7260 .7298 .7375
</TABLE>
- ----------
<PAGE>
Page 12
The following presents Canadian production information which allows
comparison to other Canadian oil and gas companies. Gross volumes and
revenues represent the Company's working interest before deduction of
associated freehold, provincial and other royalties.
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
------------------- -------------------
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Gross volume
Oil (bbls) 283,000 220,000 88,000 79,000
Gas (mmcf) 10,507 13,404 3,294 3,935
Royalty
Provincial and other
Oil (bbls) (43,000) (33,000) (14,000) (10,000)
Gas (mmcf) (1,360) (1,858) (427) (499)
ARTC
Oil (bbls) 12,000 10,000 4,000 3,000
Gas (mmcf) 227 302 51 96
Net volume
Oil (bbls) 252,000 197,000 78,000 72,000
Gas (mmcf) 9,374 11,848 2,918 3,532
Gross revenue (in thousands)
Oil $ 4,732 $ 3,173 $ 1,643 $ 1,098
Gas 9,408 12,010 2,816 3,645
Royalty
Provincial and other (2,040) (2,068) (603) (563)
ARTC 461 428 125 121
-------- -------- -------- --------
Net revenue (in thousands)
Oil $ 4,198 $ 2,840 $ 1,468 $ 1,007
Gas 8,363 10,703 2,513 3,294
-------- -------- -------- --------
$12,561 $13,543 $ 3,981 $ 4,301
======== ======== ======== ========
</TABLE>
Alberta Royalty Tax Credit ("ARTC") represents a price-sensitive rebate by
the Government of Alberta of royalty paid to the province. Prior to 1995
the Company classified ARTC for financial reporting purposes as a reduction
in the income tax provision, and thereafter as oil and gas revenue.
- ----------
<PAGE>
Page 13
LIQUIDITY AND CAPITAL RESOURCES
During the first nine months of 1996, $6.0 million of cash flows were
required for operating activities. In the nine months ended September 30, 1996,
working capital required for operations reached $15.1 million, $12.6 million
higher than utilized for the same period in 1995. This increase in working
capital utilized was primarily Refinery related as inventory and trade
receivables increased $9.0 million and $5.0 million, respectively, due to the
increase in crude oil prices in 1996, while Refinery accrued turnaround cost
increased $5.3 million in 1996. Bank borrowings increased $11.2 million under
the Frontier line of credit to cover these working capital increases and
Refinery capital expenditures of $3.5 million in 1996. Also, during the nine
months ended September 30, 1996, the decrease in cash of $2.6 million together
with proceeds of $2.0 million received on the resale of 12% Senior Notes were
utilized to reduce current liabilities associated with disposition of the
United States oil and gas operations by approximately $3.5 million. During the
first nine months of 1995, $11,000 of cash flows were provided by operating
activities and $.7 million provided by investing activities including proceeds
from the sale of oil and gas properties totaling $15.3 million. In the first
nine months of 1995, the Company reduced reserve-based borrowings by $9.0
million and increased borrowings under the Frontier working capital facility by
$4.7 million. Reserve-based borrowing reductions were provided by proceeds
from property sales.
At September 30, 1996, the Company had no debt outstanding on its C$18.0
million reserve-based line of credit and $8.8 million available under the
Frontier line of credit. The Company had working capital of $8.2 million at
September 30, 1996 compared with $5.2 million at September 30, 1995. The
estimated five-year maturities of long-term debt, excluding borrowings under
the Frontier line of credit, are $2.5 million in 1997, $5.0 million in 1998,
$2.3 million in 2000 and $2.3 million in 2001.
Effective September 30, 1996, the Company amended its reserve-based credit
facility to reduce its tangible net worth and fixed charge coverage covenants
which the Company otherwise would have violated, and to extend its revolving
period thereunder from December 31, 1997 to December 31, 1998. The loan
previously converted to a two-year term loan on December 31, 1998 with payments
commencing on March 31, 1999, whereas the September 30, 1996 amendment now
requires payment in full of all outstanding principal on the maturity date
December 31, 1998. Effective September 30, 1996, interest rates on the prime
loan increased one-quarter of one percent to the bank's prime rate plus one
percent. Also, the interest rate on Euro-Dollar loans increased from LIBOR, at
its prevailing rate, plus one and three-quarters percent to LIBOR plus two
percent providing the outstanding principal under the credit facility is equal
to or less than C$5 million, or LIBOR plus two and one-quarter percent in the
event the outstanding principal under the credit facility exceeds C$5 million.
Finally, issuance fees for letters of credit increased from one and
three-quarters percent to two percent if on the issue date the outstanding
principal under the credit facility is equal to or less than C$5 million, or
two and one-quarter percent if on the issue date the outstanding principal
under the credit facility exceeds C$5 million. The credit agreement can be
extended annually at the option of the lenders.
Investing activities include proceeds from the sales of Canadian oil and
gas properties of $.9 million for the nine months ended September 30, 1996. In
1995 property sales totaled $15.3 million; of which $12.6 million was
attributable to United States properties; and $2.7 million was related to
Canadian properties including proceeds of $1.8 million for the sale of its
interest in a Canadian gas marketing company. Additions to property and
equipment in the first nine months decreased $3.8 million from the first nine
months in 1995. In the first nine months of 1996, capital expenditures in
Canada decreased approximately $2.3 million to $7.0 million, expenditures at
the Refinery decreased approximately $1.0 million to $3.5 million, and
expenditures related to United States oil and gas operations decreased
approximately $.6 million below 1995 levels. Capital expenditures of
approximately $12.5 million are currently budgeted for 1996, of which $9.1
million had been incurred as of September 30, 1996. The Company anticipates
funding the remaining 1996 capital expenditures with cash provided by
operations, currently arranged lines of credit or other sources if necessary.
- ----------
<PAGE>
Page 14
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings -
None, which in the opinion of management would have a material
impact on the registrant.
ITEM 2. Changes in Securities -
There have been no changes in the constituent instruments defining
the rights of the holders of any class of registered securities
during the current quarter.
ITEM 3. Defaults Upon Senior Securities -
None.
ITEM 4. Submission of Matters to a Vote of Security Holders -
None.
ITEM 5. Other Information -
None.
ITEM 6. Exhibits and Reports on Form 8-K -
10.01 - First Amending Agreement dated September 30, 1996 to the
Amended and Restated Credit Agreement dated January 30, 1996
with certain banks and J.P. Morgan Canada, as Agent.
27 - Financial Data Schedule
- ----------
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
WAINOCO OIL CORPORATION
By:
/s/ Joel M. Mann
Joel M. Mann
Vice President - Controller
Date: November 14, 1996
FIRST AMENDING AGREEMENT TO AMENDED AND
RESTATED CREDIT AGREEMENT DATED JANUARY 30, 1996
THIS AGREEMENT made effective as of the 30th day of September, 1996
AMONG:
WAINOCO OIL CORPORATION, a body corporate having offices in the City
of Houston, in the State of Texas, as Borrower
- and -
J.P. MORGAN CANADA, a Canadian chartered bank having offices in the
City of Toronto, in the Province of Ontario, as a Bank and in its
capacity as Agent
- and -
PARIBAS BANK OF CANADA, a Canadian chartered bank having offices in
the City of Toronto, in the Province of Ontario, as a Bank and in its
capacity as Fronting Bank
WHEREAS the parties hereto have entered into an Amended and Restated
Credit Agreement dated January 30, 1996 (the "Credit Agreement") which provides
for a revolving credit facility in the maximum principal amount of Cdn.
$18,000,000;
AND WHEREAS the parties hereto wish to amend the Credit Agreement as
hereinafter provided;
NOW THEREFORE, in consideration of the sum of one dollar ($1.00) and
other good and valuable consideration, receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:
1. Interpretation
(a) Capitalized terms used herein shall, unless otherwise defined,
have the meanings given to them in the Credit Agreement.
(b) In this Agreement, words importing the singular number include
the plural and vice-versa and words importing gender include
masculine, feminine and neuter.
(c) The division of this Agreement into Sections and paragraphs and
the insertion of headings are for convenience of reference only
and shall not affect the construction or interpretation hereof.
(d) The terms "this Agreement", "hereof", "herein", "hereunder" and
similar expressions refer, unless otherwise stated, to this
Agreement taken as a whole and not to any particular Section or
paragraph.
2. Amendments
2.1 The definitions of "Net Proceeds from Petroleum Operations",
"Principal Repayment Date", "Projected Cash Flow Available for Fixed Charges"
and "Termination Date" are deleted from Section 1.1 of the Credit Agreement.
2.2 The following definition is added to Section 1.1 of the Credit
Agreement immediately after the definition of "Assignee":
"Available Cash Flow" means, as at the end of any fiscal quarter, the
sum of:
(i) the net income of the Borrower (determined by excluding any
amounts of FHI EBITDA which would otherwise be included therein)
for the period of four consecutive fiscal quarters of the
Borrower then ended plus, to the extent deducted in determining
such net income for such period, the aggregate amount of (A)
interest expense, (B) provision for income taxes and (C)
depletion, depreciation, amortization and other similar non-cash
charges, less all non-cash gains added in computing such net
income for such period;
(ii) the FHI EBITDA calculated using any four fiscal quarters in the
period of five consecutive fiscal quarters of FHI then ended,
less (A) all non-cash gains added in computing such net income
for such four fiscal quarters, and (B) U.S. $5,000,000
(representing a notional deduction for capital costs of FHI
incurred during such four fiscal quarters).".
2.3 The definition of "Fixed Charges" contained in Section 1.1 of the
Credit Agreement is deleted and the following is substituted therefor:
""Fixed Charges" means, for any period of four consecutive fiscal
quarters, the sum of:
(i) interest payments required to be made on Debt of the Borrower or
any Subsidiary during such period, provided that,
(A) subject to paragraph (B) immediately below, if the rate of
interest applicable to any Debt is an unknown or variable
rate, then the rate to be used for the purpose of such
determination shall be the rate per annum equal to the
weighted average applicable rate of interest paid by such
Person on such Debt during the then most recently ended
calendar month prior to such period,
(B) with respect to Debt under the FHI Credit Agreement and
Debt hereunder, the rate of interest to be used for the
purposes of a determination shall be the rate per annum
equal to the rate of interest that was in effect for such
Debt as at the last day of the fiscal quarter of the
Borrower immediately prior to such period,
(C) the principal amount of Debt outstanding during such period
shall be assumed to be the amount outstanding at the last
day of the fiscal quarter of the Borrower immediately prior
to such period, reduced as contemplated by clause (iii)
below;
(ii) any scheduled sinking fund payments required to be made by the
Borrower on account of the Subordinated Debentures during such
period; and
(iii) any other scheduled payments of principal required to be made on
Debt of the Borrower or any Subsidiary during such period.".
2.4 The definition of "Loan Limit" contained in Section 1.1 of the Credit
Agreement is deleted and the following is substituted therefor:
""Loan Limit" means, (a) during the Revolving Credit Period, the
lesser of (i) the aggregate of each Bank's Commitment as reduced
pursuant to Section 2.7 and (ii) the Borrowing Base, and (b) from and
after the Maturity Date, zero.".
2.5 The definition of "Margin" contained in Section 1.1 of the Credit
Agreement is deleted and the following is substituted therefor:
""Margin" means, with respect to any Interest Period relating to a
Euro-Dollar Loan or, if such Interest Period is longer than three
months, each three month interval comprising such Interest Period:
(i) 2%, provided that the Outstanding Principal is equal to or less
than $5,000,000 at all times during such Interest Period or
three month interval, as the case may be; or
(ii) 2 1/4%, in the event that the Outstanding Principal is at any
time during such Interest Period or three month interval, as the
case may be, greater than $5,000,000.".
2.6 The definition of "Maturity Date" contained in Section 1.1 of the
Credit Agreement is amended by deleting "1999" and substituting in its place
"1998".
2.7 The definition of "Revolving Credit Period" contained in Section 1.1
of the Credit Agreement is amended by deleting "Termination Date" and
substituting in its place "the day immediately prior to the Maturity Date".
2.8 Section 2.1(a) of the Credit Agreement is amended by deleting
"Termination Date and the credit facility of each of the Banks under this
Section 2.1(a) shall be converted to a non-revolving term facility" and
substituting in its place "last day of the Revolving Credit Period".
2.9 Section 2.4(a) of the Credit Agreement is deleted and the following
is substituted therefor:
"(a) On the Maturity Date the Loan Limit shall be automatically
reduced to zero, and the Borrower shall repay in full all
outstanding Loans hereunder and all other Outstandings due or
accrued pursuant hereto.".
2.10 Section 2.5(a) of the Credit Agreement is amended by deleting "3/4 of
1%" and substituting in its place "1%".
2.11 Section 2.5 (b) of the Credit Agreement is amended by deleting "3/4
of 1%" and substituting in its place "1%".
2.12 Section 2.5(c) of the Credit Agreement is amended by deleting ", for
the Interest Period applicable thereto, at a rate per annum equal to the sum of
1 3/4% (the "Margin")" and substituting in its place "at a rate per annum equal
to the sum of the Margin".
2.13 Section 2.6(a) of the Credit Agreement is amended by deleting
"Termination Date" and substituting in its place "Maturity Date".
2.14 Section 2.9(d) of the Credit Agreement is amended by deleting ", and
the Loan Limit shall be reduced by an amount equal to the principal amount of
each such prepayment (or the Canadian Equivalent thereof as of the date of
prepayment) made after the Termination Date".
2.15 Section 2.10(b) of the Credit Agreement is amended by deleting ", and
the Loan Limit shall be reduced by an amount equal to the amount of such
prepayment (or the Canadian Equivalent thereof as of the date of prepayment)
made after the Termination Date".
2.16 Section 2.14(c) of the Credit Agreement is amended by deleting "1
3/4%" and substituting in its place "(i) 2% if on the date the Letter of Credit
is issued the Outstanding Principal (including the face amount of such Letter
of Credit) is equal to or less than $5,000,000, or (ii) 2 1/4% if on the date
the Letter of Credit is issued the Outstanding Principal (including the face
amount of such Letter of Credit) is greater than $5,000,000, in each case".
2.17 Section 5.13 of the Credit Agreement is amended by deleting
"Mortgaged Properties" wherever it appears in such section and substituting in
its place "Engineered Properties specifically subject to the Lien of and
specifically identified in the Security Documents".
2.18 Section 5.17 of the Credit Agreement is deleted and the following is
substituted therefor:
"5.17 Minimum Fixed Charge Coverage
(a) (i) As at the end of each of the Borrower's fiscal quarters
ending December 31, 1996 and March 31, 1997, the Available
Cash Flow shall be greater than 125% of the Fixed Charges
for the next four fiscal quarters; provided that, for the
purposes of determining Fixed Charges as at March 31, 1997,
the sinking fund payment required to be made by the
Borrower on October 1, 1997 in the amount of U.S.
$2,500,000 on account of the Subordinated Debentures shall
be excluded.
(ii) As at the end of each of the Borrower's fiscal quarters
ending after March 31, 1997, the Available Cash Flow shall
be greater than 150% of the Fixed Charges for the next four
fiscal quarters.
(b) In determining Fixed Charges, all currencies other than U.S.
Dollars shall be converted into U.S. Dollars at a rate of
exchange equal to the average Spot Rate for the calendar month
ending on or immediately prior to the date as of which such
determination is being made.".
2.19 Section 5.18 of the Credit Agreement is deleted and the following is
substituted therefor:
"5.18 Minimum Consolidated Net Worth
Consolidated Tangible Net Worth shall at no time be less than:
(a) during the Borrower's fiscal quarter ending December 31,
1996, U.S. $19,500,000;
(b) during the Borrower's fiscal quarter ending March 31, 1997,
U.S. $10,000,000; and
(b) after March 31, 1997, the greater of (i) U.S. $10,000,000
and (ii) 85% of the actual Consolidated Tangible Net Worth
as set forth in the compliance certificate delivered by the
Borrower to each of the Banks pursuant to Section 5.1 (c)
for the fiscal quarter ending March 31, 1997, subject to
the confirmation by and approval of the Agent, acting
reasonably.".
2.20 Section 5.19 of the Credit Agreement is deleted and the following is
substituted therefor:
"5.19 Interest Coverage Ratio
Consolidated EBITDA shall:
(a) for any four fiscal quarters within each period of five
consecutive fiscal quarters ending on December 31, 1996 and
March 31, 1997, be greater than or equal to 140% of the
consolidated interest expense of the Borrower and its
Consolidated Subsidiaries for such four fiscal quarters;
and
(b) for any four fiscal quarters within all periods of five
consecutive fiscal quarters ending after March 31, 1997, be
greater than or equal to 160% of the consolidated interest
expense of the Borrower and its Consolidated Subsidiaries
for such four fiscal quarters.".
3. Waiver
At the request of the Borrower, the Banks hereby irrevocably waive
compliance with Section 5.17 of the Credit Agreement as at the end of, and
Section 5.18 of the Credit Agreement during, the fiscal quarter of the Borrower
ending September 30, 1996. This waiver shall be limited precisely as written,
and shall not extend to (i) any non-compliance with or breach of any other
provision of the Credit Agreement, (ii) any non-compliance with or breach of
Section 5.17 as at the end of any other fiscal quarter, (iii) any
non-compliance with or breach of Section 5.18 at any other time or (iv) any
Default under the Credit Agreement other than a Default as a result of the
non-compliance with Sections 5.17 or 5.18 hereinbefore waived.
4. Amendment Fee
In consideration for the Banks amending the terms and provisions of
the Credit Agreement as herein provided, the Borrower hereby agrees to pay to
the Banks an amendment fee of U.S. $100,000. Upon the execution of this
Agreement, such fee shall be paid by the Borrower in full to the Agent for the
account of the Banks ratably in proportion to their respective Commitments.
5. Governing Law
This Agreement shall be governed by and construed in accordance with
the laws of the Province of Alberta and the laws of Canada applicable therein,
and shall be treated as an Alberta contract.
6. Counterpart Execution
This Agreement may be executed in any number of counterparts and all
executed counterparts shall be read together and shall form one and the same
instrument.
7. Ratification
The Credit Agreement as amended by this Agreement is hereby ratified
and confirmed in all respects as being in full force and effect.
8. Enurement
Subject to Section 9.6 of the Credit Agreement, this Agreement shall
enure to the benefit of and be binding upon each of the parties hereto and its
permitted successors and assigns.
WAINOCO OIL CORPORATION, as Borrower
By: /s/ Julie H. Edwards
Julie H. Edwards
Title: Senior Vice President - Finance
& Chief Financial Officer
J.P. MORGAN CANADA, as Agent and as a Bank
By: /s/ David B. Weir
David B. Weir
Title: President
PARIBAS BANK OF CANADA, as Fronting Bank
and as a Bank
By: /s/ John Plant
John Plant
Title: Vice President
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 3,462
<SECURITIES> 0
<RECEIVABLES> 27,388
<ALLOWANCES> 0
<INVENTORY> 28,734
<CURRENT-ASSETS> 59,974
<PP&E> 315,237
<DEPRECIATION> 135,590
<TOTAL-ASSETS> 244,445
<CURRENT-LIABILITIES> 51,763
<BONDS> 158,615
0
0
<COMMON> 57,172
<OTHER-SE> (29,236)
<TOTAL-LIABILITY-AND-EQUITY> 244,445
<SALES> 294,571
<TOTAL-REVENUES> 297,071
<CGS> 281,852
<TOTAL-COSTS> 281,852
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 12,974
<INCOME-PRETAX> (4,362)
<INCOME-TAX> 311
<INCOME-CONTINUING> (4,673)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,673)
<EPS-PRIMARY> (0.17)
<EPS-DILUTED> (0.17)
</TABLE>
