UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) JANUARY 4, 1999
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EQUITABLE RESOURCES, INC.
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 1-3551 25-0464690
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
420 Boulevard of the Allies, Pittsburgh, Pennsylvania 15219
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (412) 261-3000
-----------------------------
NONE
(Former name or former address, if changed since last report)
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Item 5. Other Events
The registrant, Equitable Resources, Inc., announced that it
expects to record up to $120 million in pretax charges related to
restructuring, asset impairment, and other nonrecurring charges in
the fourth quarter. Included in this number is a charge for early
extinguishment of debt.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) A press release describing more fully the previously announced
fourth quarter charges expected for restructuring, asset
impairments, other nonrecurring charges and early extinguishment
of debt, is filed as Exhibit 99 to this report.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereto duly authorized.
EQUITABLE RESOURCES, INC.
(Registrant)
By /s/ David L. Porges
David L. Porges
Senior Vice President and
Chief Financial Officer
January 4, 1999
Exhibit 99
December 29, 1998 Contact: Robert Butter, Media
412/553-5911
Robert Atkinson, Analysts
412/553-5768
Equitable Resources Targets $20 Million in Cost Savings
PITTSBURGH - Equitable Resources (NYSE: EQT) today announced that it expects to
reduce annual operating expenses by approximately $20 million as a result of the
implementation of previously announced cost savings measures, reduced interest
charges, and lower depreciation and depletion expense. The company said it will
record a one-time, pre-tax charge of approximately $60 million in the fourth
quarter to account for severance and other costs associated with staff
reductions, other restructuring charges, and the early extinguishment of debt.
In addition, Equitable will record a one-time, non-cash expense of approximately
$60 million, primarily for the writedown of selected natural gas and oil
properties located in the Gulf region. This writedown recognizes the lower value
for those properties as a result of depressed wellhead prices for oil and
natural gas and dry hole costs. In total, the company will record approximately
$120 million in charges related to restructuring, asset impairment, and other
nonrecurring charges. Included in this number is $13 million ($8 million
after-tax) for the early extinguishment of certain higher cost long-term debt,
which will be accounted for as an extraordinary item.
The cost savings measures were initiated by the company as part of a program to
realize a more competitive cost structure in all of its core businesses. To help
reduce overhead costs, the company has transferred a number of activities
formerly conducted at the corporate level to the business units, reduced
corporate staff positions, and streamlined management information systems
throughout the corporation.
Equitable Utilities is reducing its staffing level to achieve a more competitive
cost structure in its distribution and interstate pipeline operations, while
improving efficiency and maintaining system reliability and safety.
The company has also realigned the management of its production (E&P) business
under the new name, Equitable Production. Equitable Production - East Region
will manage the Appalachian-area E&P, natural gas gathering, and liquids
processing operations. Equitable Production - Gulf Region is responsible for all
E&P activities in the offshore Gulf of Mexico.
<PAGE>
(more)
Equitable Resources has combined all non-regulated marketing activities under
Equitable Services. This combination brings together the commodity marketing
services provided by Equitable Energy and the total energy management services
offered by NORESCO. The change will allow the company to more effectively
deliver these services to its customers. Equitable Services is reducing its
operating expense and overhead with the closing and combining of a number of
smaller offices and a reduction in staff.
The company said it expects its total number of employees will be fewer than
1,600 by the first of the year, a 20 percent reduction compared to mid-year
1998.
Equitable Resources is an integrated energy company, with emphasis on
Appalachian area natural gas production, natural gas transmission and
distribution and energy services marketing in the northeastern section of the
United States. The Company also has exploration and production interests in the
Gulf of Mexico and energy service management projects in selected U.S. and
international markets.
# # # #
NOTE: This news release contains forward-looking statements related to such
matters as financial performance, business prospects and operational matters.
The company notes that a variety of factors could cause the actual results to
differ materially from anticipated results or other expectations expressed in
the company's forward-looking statements. The risks and uncertainties that may
affect the operations, performance, development and results of the company
business include, but are not limited to, the following: weather conditions, the
pace of deregulation of retail natural gas and electricity markets, the timing
and extent of changes in commodity prices for gas and oil, changes in interest
rates, the timing and extent of the company's success in acquiring gas and oil
properties and in discovering, developing and producing reserves, the inability
of the company or others to remediate Year 2000 concerns in a timely fashion,
delays in obtaining necessary governmental approvals and the impact of
competitive factors on profit margins in various markets in which the company
competes.
