SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTER ENDED DECEMBER 31, 1994
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ___ TO ___
Commission IRS Employer
File State of Identification
Number Registrant Incorporation Number
1-7810 Energen Corporation Alabama 63-0757759
2-38960 Alabama Gas Corporation Alabama 63-0022000
2101 Sixth Avenue North
Birmingham, Alabama 35203
Telephone Number 205/326-2700
Alabama Gas Corporation, a wholly owned subsidiary of Energen Corporation, meets
the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q
and is therefore filing this Form with reduced disclosure format pursuant to
General Instruction H(2).
Indicate by a check mark whether the registrants (1) have filed all reports
required to be filed by Section 13 or 15(d) of the Securities and Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrants were required to file such reports), and (2) have been subject to
such filing requirements for the past 90 days. YES X NO ____
Indicate the number of shares outstanding of each of the issuers' classes of
common stock, as of February 6, 1994:
Energen Corporation, $0.01 par value 10,911,377 shares
Alabama Gas Corporation, $0.01 par value 1,972,052 shares
<PAGE>
ENERGEN CORPORATION AND ALABAMA GAS CORPORATION
FORM 10-Q FOR THE QUARTER ENDED DECEMBER 31, 1994
TABLE OF CONTENTS
Page
PART I: FINANCIAL INFORMATION (Unaudited)
Item 1. Financial Statements
(a) Consolidated Statements of Income of Energen Corporation 4
(b) Consolidated Balance Sheets of Energen Corporation 5
(c) Consolidated Statements of Cash Flows of Energen Corporation 7
(d) Statements of Income of Alabama Gas Corporation 8
(e) Balance Sheets of Alabama Gas Corporation 9
(f) Statements of Cash Flows of Alabama Gas Corporation 11
(g) Notes to Unaudited Financial Statements 12
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 14
Selected Business Segment Data of Energen Corporation 17
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 18
SIGNATURES 20
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<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF INCOME
Energen Corporation and Subsidiaries
(Unaudited)
<CAPTION>
Three months ended December 31, (in thousands, except share data) 1994 1993
OPERATING REVENUES
<S> <C> <C>
Natural gas distribution $67,226 $78,993
Oil and gas production activities 5,931 6,201
Other 2,416 5,248
Intercompany eliminations (2,089) (2,523)
Total operating revenues 73,484 87,919
OPERATING EXPENSES
Cost of gas 31,050 43,374
Operations 22,127 23,143
Maintenance 2,264 2,251
Depreciation, depletion and amortization 6,966 6,711
Taxes, other than income taxes 5,641 6,727
Total operating expenses 68,048 82,206
OPERATING INCOME 5,436 5,713
OTHER INCOME (EXPENSE)
Interest expense, net of amounts capitalized (2,775) (2,922)
Other, net 724 196
Total other income (expense) (2,051) (2,726)
INCOME BEFORE INCOME TAXES 3,385 2,987
Income taxes 649 687
NET INCOME $ 2,736 $2,300
EARNINGS PER AVERAGE COMMON SHARE $ 0.25 $ 0.22
DIVIDENDS PER COMMON SHARE $ 0.28 $ 0.27
AVERAGE COMMON SHARES OUTSTANDING 10,920 10,587
The accompanying Notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
CONSOLIDATED BALANCE SHEETS
Energen Corporation and Subsidiaries
(Unaudited)
<CAPTION>
December 31, September 30,
(in thousands) 1994 1994
ASSETS
PROPERTY, PLANT AND EQUIPMENT
<S> <C> <C>
Utility plant $ 473,887 $ 464,593
Less accumulated depreciation 235,579 231,327
Utility plant, net 238,308 233,266
Oil and gas properties, successful efforts method 95,239 92,355
Less accumulated depreciation, depletion and amortization 44,944 43,052
Oil and gas properties, net 50,295 49,303
Other property, net 4,395 4,613
Total property, plant and equipment, net 292,998 287,182
CURRENT ASSETS
Cash and cash equivalents 2,527 27,526
Accounts receivable, net of allowance for doubtful
accounts of $2,037 at December 31, 1994 and
September 30, 1994 45,078 34,145
Inventories, at average cost
Storage gas 24,364 24,363
Materials and supplies 7,824 7,589
Liquified natural gas in storage 3,902 3,349
Deferred gas costs 8,905 1,460
Deferred income taxes 7,600 7,542
Prepayments and other 2,699 3,117
Total current assets 102,899 109,091
OTHER ASSETS
Notes receivable 3,683 3,911
Deferred charges and other 10,999 11,130
Total other assets 14,682 15,041
TOTAL ASSETS $ 410,579 $411,314
The accompanying Notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
CONSOLIDATED BALANCE SHEETS
Energen Corporation and Subsidiaries
(Unaudited)
<CAPTION>
December 31, September 30,
(in thousands) 1994 1994
CAPITAL AND LIABILITIES
CAPITALIZATION
Preferred stock, cumulative $0.01 par value, 5,000,000
<S> <C> <C>
shares authorized $ - $ -
Common shareholders' equity
Common stock, $0.01 par value; 30,000,000 shares authorized,
10,917,577 shares outstanding at December 31, 1994 and
10,917,904 shares outstanding at September 30, 1994 109 109
Premium on capital stock 81,134 81,073
Capital surplus 2,802 2,802
Retained earnings 82,720 83,042
Treasury stock at cost, 2,400 shares (49) -
Total common shareholders' equity 166,716 167,026
Long-term debt 118,210 118,302
Total capitalization 284,926 285,328
CURRENT LIABILITIES
Long-term debt due within one year 3,793 10,123
Notes payable to banks 2,000 6,000
Accounts payable 35,186 27,480
Accrued taxes 13,034 13,083
Customers' deposits 17,807 17,462
Amounts due customers 13,211 11,734
Accrued wages and benefits 10,422 9,662
Other 15,081 15,129
Total current liabilities 110,534 110,673
DEFERRED CREDITS AND OTHER LIABILITIES
Deferred income taxes 1,827 1,706
Accumulated deferred investment tax credits 4,469 4,590
Other 8,823 9,017
Total deferred credits and other liabilities 15,119 15,313
COMMITMENTS AND CONTINGENCIES - -
TOTAL CAPITAL AND LIABILITIES $ 410,579 $411,314
The accompanying Notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOW
Energen Corporation and Subsidiaries
(Unaudited)
<CAPTION>
Three months ended December 31, (in thousands) 1994 1993
OPERATING ACTIVITIES
<S> <C> <C>
Net Income $ 2,736 $ 2,300
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation, depletion and amortization 6,966 6,711
Deferred income taxes, net (103) 212
Deferred investment tax credits, net (121) (121)
Gain on sale of equity securities - (1,375)
Net change in:
Accounts receivable (10,933) (15,590)
Inventories (789) (22,201)
Accounts payable 7,706 10,915
Other current assets and liabilities (4,542) (6,853)
Other, net (125) (98)
Net cash provided by (used in) operating activities 795 (26,100)
INVESTING ACTIVITIES
Additions to property, plant and equipment (12,558) (7,193)
Proceeds from sale of equity securities - 3,305
Payments on notes receivable 228 693
Other, net 4 1,569
Net cash used in investing activities (12,326) (1,626)
FINANCING ACTIVITIES
Payment of dividends on common stock (3,058) (2,795)
Issuance of common stock 61 14,721
Purchase of treasury stock (49) -
Reduction of long-term debt and preferred stock of subsidiary (6,422) (8,899)
Proceeds from issuance of medium-term notes - 26,675
Net change in short-term debt (4,000) (12,000)
Net cash provided by (used in) financing activities (13,468) 17,702
Net change in cash and cash equivalents (24,999) (10,024)
Cash and cash equivalents at beginning of period 27,526 15,008
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,527 $ 4,984
The accompanying Notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENTS OF INCOME
Alabama Gas Corporation
(Unaudited)
<CAPTION>
Three months ended December 31, (in thousands) 1994 1993
<S> <C> <C>
OPERATING REVENUES $67,226 $78,993
OPERATING EXPENSES
Cost of gas 31,994 44,610
Operations 18,357 18,248
Maintenance 2,228 2,153
Depreciation 4,737 4,427
Income taxes
Current 1,062 361
Deferred, net (118) (32)
Deferred investment tax credits, net (122) (122)
Taxes, other than income taxes 5,392 6,403
Total operating expenses 63,530 76,048
OPERATING INCOME 3,696 2,945
OTHER INCOME
Allowance for funds used during construction 186 76
Other, net 158 (208)
Total other income 344 (132)
INTEREST CHARGES
Interest on long-term debt 1,757 1,419
Other interest expense 532 698
Total interest charges 2,289 2,117
NET INCOME AVAILABLE FOR COMMON $ 1,751 $ 696
The accompanying Notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
BALANCE SHEETS
Alabama Gas Corporation
(Unaudited)
<CAPTION>
December 31, September 30,
(in thousands) 1994 1994
ASSETS
PROPERTY, PLANT AND EQUIPMENT
<S> <C> <C>
Utility plant $ 473,887 $ 464,593
Less accumulated depreciation 235,579 231,327
Utility plant, net 238,308 233,266
Other property, net 180 183
CURRENT ASSETS
Cash and cash equivalents 1,391 156
Accounts receivable
Gas 31,257 22,209
Merchandise 1,485 1,326
Other 1,654 1,512
Allowance for doubtful accounts (2,000) (2,000)
Inventories, at average cost
Storage gas 24,364 24,363
Materials and supplies 5,550 5,688
Liquified natural gas in storage 3,902 3,349
Deferred gas costs 8,905 1,460
Deferred income taxes 5,770 5,724
Prepayments and other 2,196 2,595
Total current assets 84,474 66,382
DEFERRED CHARGES AND OTHER ASSETS 9,054 9,074
TOTAL ASSETS $332,016 $308,905
The accompanying Notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
BALANCE SHEETS
Alabama Gas Corporation
(Unaudited)
CAPTION>
December 31, September 30,
(in thousands) 1994 1994
CAPITAL AND LIABILITIES
CAPITALIZATION
<S> <C> <C>
Common shareholder's equity
Common stock, $0.01 par value; 3,000,000 shares authorized,
1,972,052 shares outstanding at December 31, 1994 and
September 30, 1994 $ 20 $ 20
Premium on capital stock 31,682 31,682
Capital surplus 2,802 2,802
Retained earnings 79,778 81,087
Total common shareholder's equity 114,282 115,591
Cumulative preferred stock, $0.01 par value, 120,000 shares
authorized, issuable in series-$4.70 Series - -
Long-term debt 84,359 84,391
Total capitalization 198,641 199,982
CURRENT LIABILITIES
Long-term debt due within one year 2,793 2,823
Notes payable to banks 2,000 4,000
Accounts payable
Other 28,239 19,002
Affiliated companies 17,581 132
Accrued taxes 12,952 14,241
Customers' deposits 17,807 17,462
Supplier refunds due customers - 832
Other amounts due customers 13,211 10,902
Accrued wages and benefits 6,075 5,659
Other 6,673 7,605
Total current liabilities 107,331 82,658
DEFERRED CREDITS AND OTHER LIABILITIES
Deferred income taxes 13,798 13,704
Accumulated deferred investment tax credits 4,469 4,590
Regulatory liability 6,746 6,960
Customer advances for construction and other 1,031 1,011
Total deferred credits and other liabilities 26,044 26,265
COMMITMENTS AND CONTINGENCIES - -
TOTAL CAPITAL AND LIABILITIES $332,016 $308,905
The accompanying Notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENTS OF CASH FLOW
Alabama Gas Corporation
(Unaudited)
<CAPTION>
Three months ended December 31, (in thousands) 1994 1993
OPERATING ACTIVITIES
<S> <C> <C>
Net Income $ 1,751 $ 696
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 4,737 4,427
Deferred income taxes, net (118) (32)
Deferred investment tax credits (122) (122)
Net change in:
Accounts receivable (9,349) (14,869)
Inventories (416) (22,422)
Accounts payable 9,340 15,342
Other current assets and liabilities (7,029) (8,398)
Other, net (175) 461
Net cash used in operating activities (1,381) (24,917)
INVESTING ACTIVITIES
Additions to property, plant and equipment (9,551) (5,214)
Net advances to holding company - 87
Other, net (57) (21)
Net cash used in investing activities (9,608) (5,148)
FINANCING ACTIVITIES
Payment of dividends on common stock (3,060) (2,795)
Reduction of long-term debt (62) (8,299)
Proceeds from issuance of medium-term notes - 26,675
Proceeds from equity infusion from parent - 10,000
Net advances from affiliates 17,346 6,925
Net change in short-term debt (2,000) (1,000)
Net cash provided by financing activities 12,224 31,506
Net change in cash and cash equivalents 1,235 1,441
Cash and cash equivalents at beginning of period 156 480
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,391 $1,921
The accompanying Notes are an integral part of these statements.
</TABLE>
<PAGE>
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Energen Corporation and Alabama Gas Corporation
1. BASIS OF PRESENTATION
All adjustments to the unaudited financial statements which are, in the opinion
of management, necessary for a fair statement of the results of operations for
the interim periods have been recorded. Such adjustments consisted only of
normal recurring items. The consolidated financial statements and notes
thereto should be read in conjunction with the financial statements and notes
for the years ended September 30, 1994, 1993, and 1992 included in the 1994
Annual Report of Energen Corporation (the Company) on Form 10-K. Certain
reclassifications were made to conform prior years' financial statements to
the current quarter presentation. The Company's primary business is seasonal
in character and influenced by weather conditions. Results of operations
for the interim periods are not necessarily indicative of the results which
may be expected for the fiscal year.
2. REGULATORY
As an Alabama utility, Alagasco is subject to regulation by the APSC which,
in 1983, established the Rate Stabilization and Equalization (RSE) rate-
setting process. RSE was extended for the third time on December 3, 1990,
for a three-year period. Under the terms of that extension, RSE
shall continue after November 30, 1993, unless, after notice to the Company,
the Commission votes to either modify or discontinue its operation.
On October 4, 1993, the Commission unanimously voted to extend RSE until
such time as certain hearings mandated by the Energy Policy Act of 1992
(Energy Act) in connection with integrated resource planning management
programs are completed. The Energy Act proceedings are expected to conclude
during fiscal 1995 at which time it is expected that the Commission will
begin reviewing Alagasco's RSE. No time table for review has yet
been established.
Under RSE as extended, the APSC conducts quarterly reviews to determine, based
on Alagasco's projections and fiscal year-to-date performance, whether
Alagasco's return on equity for the fiscal year will be within the
allowed range of 13.15 percent to 13.65 percent. Reductions in rates can
be made quarterly to bring the projected return within the allowed range;
increases, however, are allowed only once each fiscal year, effective
December 1, and cannot exceed 4 percent of prior-year revenues.
RSE limits the utility's equity upon which a return is permitted to 60 percent
of total capitalization and provides for certain cost control measures
designed to monitor the Company's operations and maintenance (O&M) expense.
If O&M expense per customer falls within 1.25 percentage points above
or below the Consumer Price Index For All Urban Customers (index range),
no adjustment is required. If, however, O&M expense per customer
exceeds the index range, three-quarters of the difference will be returned
to the customers. To the extent O&M expense per customer is less
than the index range, the utility will benefit by one-half of the difference
through future rate adjustments. Effective December 15, 1990, the
APSC approved a temperature adjustment to customers' monthly bills to
remove the effect of departures from normal temperature on
Alagasco's earnings. The calculation is performed monthly, and the adjustment
to customers' bills is made in the same month the weather variation
occurs. Under RSE as extended, a $1.1 million decrease in revenue became
effective October 1, 1994, and a $5.2 million annual increase in revenue
became effective December 1, 1994.
The Company's rate schedules for natural gas distribution charges contained a
Gas Supply Adjustment rider which permits the pass-through of changes
in gas costs to customers and gas supply realignment surcharges imposed
by the Company's suppliers resulting from changes in gas supply purchases
related to the implementation of FERC Order 636.
In accordance with APSC-directed regulatory accounting procedures, Alagasco
in 1989 began returning excess utility deferred taxes which resulted from a
reduction in the federal statutory tax rate from 46 percent to 34 percent
using the average rate assumption method. This method provides for the
return to ratepayers of excess deferred taxes over the lives of the related
assets. In 1993 those excess taxes were reduced as a result of a
federal tax rate increase from 34 percent to 35 percent. Approximately $3.1
million of remaining excess utility deferred taxes is being returned to
ratepayers over approximately 16 years.
3. SUPPLEMENTAL CASH FLOW INFORMATION
ENERGEN CORPORATION
Three months ended December 31, (in thousands) 1994 1993
Interest paid, net of amounts capitalized $ 4,627 $ 3,753
Income taxes paid $ (51) $ 158
Noncash investing activities (capitalized depreciation
and allowance for funds used during construction) $ 227 $ 122
Noncash financing activities (debt issuance costs) $ - $ 175
ALABAMA GAS CORPORATION
Three months ended December 31, (in thousands) 1994 1993
Interest paid $ 4,305 $ 3,361
Income taxes paid $ 1,712 $ (185)
Noncash investing activities (capitalized depreciation
and allowance for funds used during construction) $ 227 $ 122
Noncash financing activities (debt issuance costs) $ - $ 175
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Consolidated net income for the first quarter was $2,736,000 ($0.25 per share)
compared to $2,300,000 ($0.22 per share) in the prior year. The increase is
due primarily to Alagasco earning its allowed return for the full three
months on an increased level of equity resulting from last year's underground
working storage gas investment. Partially offsetting this increase were
Taurus's decreased contribution to consolidated earnings associated largely
with lower natural gas prices and increased exploration expense, and the
absence of contribution from W & J Propane that was sold during the
third quarter of the prior year.
Two factors created the majority of the 15 percent decrease in utility natural
gas revenues for the quarter. The benefit of lower commodity cost of gas
was passed through to customers in reduced rates. Additionally, warmer than
normal weather resulted in an approximate 1.6 Bcf reduction in
gas sales volumes to residential customers; partially offsetting that impact
on revenues was the recovery of margins associated with departures
from normal weather allowed under the APSC-approved weather normalization
adjustment.
A significant decrease in natural gas prices heavily influenced both
operating fees and natural gas production revenues at Taurus. Operating fees
on certain coalbed methane properties are impacted by a variety of factors
including production volume, operating expenses and the price of
natural gas, as defined by the operating agreements. The decrease in the
current quarter's operating fees is attributable almost exclusively to a
27 percent decrease in the average index price of natural gas.
With respect to gas production revenues, after giving effect to hedged
volumes, the average sales price per Mcf was $1.81 compared to $2.02 in the
prior year - a 10 percent decrease. Largely offsetting the price effect on
those revenues was a 10 percent increase in production volumes. Oil
production revenues were stable over the prior year as an increase in
the average sales price per barrel ($15.84 for the current year compared to
$15.04 in the prior year) was offset by slightly lower production volumes.
To hedge its exposure to price fluctuations on oil and gas production,
Taurus periodically enters into futures contracts. Under this program,
Taurus has entered into contracts for the sale of 3.3 Bcf of its gas
production with an average contract price of $1.95, and for the sale of 96,000
barrels of its oil production at an average contract price of $18.41 over
the remainder of this fiscal year. While more than 50 percent of estimated
gas production and over 90 percent of estimated oil production are hedged,
1995 earnings could decrease compared to 1994 due to the price risk
associated with both unhedged production volumes and operating fees. The
program has been extended into fiscal 1996 for the sale of 0.5 Bcf of gas
production with an average contract price of $1.72.
Other revenues for the quarter were significantly lower than those of the
prior year due primarily to the absence of revenues from W & J Propane.
Excluding the effect of propane revenues, other revenues would have
decreased slightly as a result of lower merchandise sales.
<PAGE>
As with natural gas revenues, decreased commodity cost coupled with
decreased sales volumes associated with warmer weather created a majority
of the $12.3 million decrease in cost of gas for the quarter.
Consolidated operations and maintenance (O&M) expense decreased 4 percent
in the quarter due to the impact of the sale of propane operations
in the prior year. Excluding the effect of propane operations, O&M expense
would have increased 4 percent primarily due to increased labor and
related expenses at Alagasco and increased exploration expense at Taurus .
Depreciation expense for the quarter increased only slightly as the effects
of normal plant growth at Alagasco and increased conventional production at
Taurus were largely offset by the absence of depreciation on propane
assets in the current year.
The Company's expense for taxes other than income taxes primarily reflects
various state and local business taxes paid by Alagasco as well as
various payroll-related taxes. State and local business taxes
are generally based on gross receipts of Alagasco and fluctuate accordingly.
A significant reduction in short-term debt outstanding and the early
repayment of certain long-term notes more than offset the effect of
medium-term notes issued in December and January of the prior
fiscal year resulting in a 5 percent decrease in interest expense.
Other income was greater for the quarter largely due to the inclusion of
redemption fees in the prior year related to the Company's
refinancing of a significant portion of its long-term debt.
Income tax expense for the quarter did not vary significantly as the effect
of higher pretax net income was essentially offset by increased
recognition of nonconventional fuel tax credits on an interim basis.
The Company anticipates effective tax rates to remain lower than statutory
rates through the year 2002 as it expects to recognize all tax credits
generated for financial statement purposes.
As previously discussed, the Company's business is seasonal in character and
influenced by weather conditions. Results of operations for the interim
periods are not necessarily indicative of the results that may be expected
for the year. As more fully discussed in Note 2, Alagasco is subject to
regulation by the APSC, which is expected to consider renewal of the utility's
rate-setting mechanism following the completion of its review of certain
mandates under the Energy Policy Act of 1992. Changes, if any,
to the utility's present rate-setting assumptions or provisions could have
an impact on its net income for 1995 and beyond.
LIQUIDITY AND CAPITAL RESOURCES
The item primarily responsible for the significant change in cash provided
by (used in) operations was the prior year investment in underground
storage working gas that totaled $22.3 million at December 31, 1993.
Fluctuations in receivables and payables are generally the result of timing
of payments.
Net cash used in investing activities was primarily influenced by two factors.
First, capital expenditures exceeded those of the prior year - Alagasco's
due to the acquisition of the 2,200-customer gas system of Alabaster and
Taurus's due to the planned expansion of its oil and gas development
activities. Second, the inclusion in the prior year of proceeds related to
the sale of equity securities served to reduce that quarter's cash used in
investing activities.
The change in net cash provided by (used in) financing activities is
attributable to several occurrences in the first quarter of the prior year.
The issuance of 550,000 shares of Energen common stock in November 1993
generated $13.5 million, and Alagasco issued $26.8 million in
medium-term notes in December 1993. These proceeds were used to fund the
investment in underground working storage gas, redeem its 8.75 percent
debentures, reduce short-term debt outstanding, and to fund
additional capital needs. Also during this quarter, 2,400 shares of
Energen common stock were repurchased under the Company's stock repurchase
program.
FUTURE CAPITAL EXPENDITURES AND LIQUIDITY: Capital and exploration
expenditures could approximate $66 million in fiscal 1995, excluding
municipal gas system acquisitions, and primarily represent additions for
normal distribution system expansion, the development of a new customer
information system at Alagasco, and oil and gas development activities.
With respect to oil and gas activities, the Company is attempting to invest
a significant portion of its capital expenditures in proven
property acquisitions. However, the market for acquisitions has been limited
and the economics of current pricing has delayed exploration opportunities;
therefore, capital expenditures may not reach targeted levels. In addition,
Alagasco will maintain an investment in storage working gas which is
anticipated to average $19 million for the fiscal year. The Company
anticipates funding these capital requirements through internally
generated capital and the utilization of short-term credit facilities.
Energen has short-term credit facilities totaling $110 million available
for working capital needs, with $2 million and $28 million outstanding at
December 31, 1994 and 1993, respectively.
<PAGE>
<TABLE>
SELECTED BUSINESS SEGMENT DATA
Energen Corporation
<CAPTION>
Three months ended December 31, (in thousands, except share data) 1994 1993
NATURAL GAS DISTRIBUTION
Operating revenues
<S> <C> <C>
Residential $44,350 $51,598
Commercial and industrial - small 15,545 19,112
Commercial and industrial - large 31 23
Transportation 7,566 7,808
Other (266) 452
Total $67,226 $78,993
Volumes sold and transported (thousands of Mcf)
Residential 5,287 6,932
Commercial and industrial - small 2,466 3,073
Commercial and industrial - large 8 5
Transportation 14,290 13,168
Total 22,051 23,178
Other data
Depreciation and amortization $ 4,737 $ 4,427
Capital expenditures $ 9,778 $ 5,336
Operating income $ 4,518 $ 3,152
OIL AND GAS EXPLORATION AND PRODUCTION
Operating revenues
Natural gas $ 3,948 $ 4,019
Oil 792 812
Other 1,191 1,370
Total $ 5,931 $ 6,201
Sales volume - natural gas (thousands of Mcf) 2,181 1,991
Sales volume - oil (thousands of barrels) 50 54
Average sales price - natural gas (per Mcf) $ 1.81 $ 2.02
Average sales price - oil (per barrel) $ 15.84 $ 15.04
Other data
Depreciation, depletion and amortization $ 2,118 $ 1,955
Capital expenditures $ 3,007 $ 1,833
Exploration expenditures $ 429 $ 55
Operating income (loss) $ 1,154 $ 2,098
<PAGE>
OTHER BUSINESS
Operating revenues $ 2,416 $ 5,248
Depreciation and amortization $ 111 $ 329
Capital expenditures $ - $ 146
Operating income $ 204 $ 774
ELIMINATIONS AND CORPORATE EXPENSES
Operating loss $ (440) $ (311)
</TABLE>
<PAGE>
PART II.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
27.1 Financial Data Schedule of Energen Corporation (for SEC
purposes only)
27.2 Financial Data Schedule of Alabama Gas Corporation (for SEC
purposes only)
b. Reports on Form 8-K
No reports on Form 8-K were filed for the three months ended
December 31, 1994.
<PAGE>
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ENERGEN CORPORATION
ALABAMA GAS CORPORATION
February 14, 1995 By/s/ Rex J. Lysinger
Rex J. Lysinger
Chairman of the Board and Chief
Executive Officer
February 14, 1995 By/s/ G. C. Ketcham
G. C. Ketcham
Executive Vice President, Chief
Financial Officer and Treasurer
February 14, 1995 By/s/ J. T. McManus
J. T. McManus
Vice President-Finance and
Corporate Development of
Energen and Vice
President-Finance and Planning
of Alagasco
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND> 27.1
This schedule contains summary financial information extracted from
the Form 10Q for December 31, 1994, and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<CIK> 0000277595
<NAME> ENERGEN CORPORATION
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-START> OCT-01-1994
<PERIOD-END> DEC-31-1994
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 238,308
<OTHER-PROPERTY-AND-INVEST> 54,690
<TOTAL-CURRENT-ASSETS> 102,899
<TOTAL-DEFERRED-CHARGES> 10,999
<OTHER-ASSETS> 3,683
<TOTAL-ASSETS> 410,579
<COMMON> 109
<CAPITAL-SURPLUS-PAID-IN> 83,887
<RETAINED-EARNINGS> 82,720
<TOTAL-COMMON-STOCKHOLDERS-EQ> 166,716
0
0
<LONG-TERM-DEBT-NET> 118,210
<SHORT-TERM-NOTES> 2,000
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 3,793
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 119,860
<TOT-CAPITALIZATION-AND-LIAB> 410,579
<GROSS-OPERATING-REVENUE> 73,484
<INCOME-TAX-EXPENSE> 649
<OTHER-OPERATING-EXPENSES> 68,048
<TOTAL-OPERATING-EXPENSES> 68,697
<OPERATING-INCOME-LOSS> 4,787
<OTHER-INCOME-NET> 724
<INCOME-BEFORE-INTEREST-EXPEN> 5,511
<TOTAL-INTEREST-EXPENSE> 2,775
<NET-INCOME> 2,736
0
<EARNINGS-AVAILABLE-FOR-COMM> 2,736
<COMMON-STOCK-DIVIDENDS> 3,058
<TOTAL-INTEREST-ON-BONDS> 2,399
<CASH-FLOW-OPERATIONS> 795
<EPS-PRIMARY> .25
<EPS-DILUTED> .25
</TABLE>
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND> EXHIBIT 27.2
This schedule contains summary financial information extracted from the
Form 10Q for December 31, 1994, and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<CIK> 0000003146
<NAME> ALABAMA GAS CORPORATION
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-START> OCT-01-1994
<PERIOD-END> DEC-31-1994
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 238,308
<OTHER-PROPERTY-AND-INVEST> 180
<TOTAL-CURRENT-ASSETS> 84,474
<TOTAL-DEFERRED-CHARGES> 9,054
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 332,016
<COMMON> 20
<CAPITAL-SURPLUS-PAID-IN> 34,484
<RETAINED-EARNINGS> 79,778
<TOTAL-COMMON-STOCKHOLDERS-EQ> 114,282
0
0
<LONG-TERM-DEBT-NET> 84,359
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 2,000
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 2,793
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 128,582
<TOT-CAPITALIZATION-AND-LIAB> 332,016
<GROSS-OPERATING-REVENUE> 67,226
<INCOME-TAX-EXPENSE> 822
<OTHER-OPERATING-EXPENSES> 62,708
<TOTAL-OPERATING-EXPENSES> 63,530
<OPERATING-INCOME-LOSS> 3,696
<OTHER-INCOME-NET> 344
<INCOME-BEFORE-INTEREST-EXPEN> 4,040
<TOTAL-INTEREST-EXPENSE> 2,289
<NET-INCOME> 1,751
0
<EARNINGS-AVAILABLE-FOR-COMM> 1,751
<COMMON-STOCK-DIVIDENDS> 3,060
<TOTAL-INTEREST-ON-BONDS> 1,707
<CASH-FLOW-OPERATIONS> (1,381)
<EPS-PRIMARY> 0<F1>
<EPS-DILUTED> 0<F1>
<FN>
<F1>Earnings per share is calculated for Energen Corporation (parent company of
Alagasco) and is not calculated for Alagasco separately as amount would not be
meaningful.
</FN>
</TABLE>
