<PAGE>
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
Commission File Number 1-8754
SWIFT ENERGY COMPANY
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<S> <C>
TEXAS 74-2073055
(State of Incorporation) (I.R.S. Employer Identification No.)
</TABLE>
16825 Northchase Drive, Suite 400
Houston, Texas 77060
(713) 874-2700
(Address and telephone number of principal executive offices)
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 and 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
---- ----
Indicate the number of shares outstanding of each of the
Registrant's classes of common stock, as of the
latest practicable date.
Common Stock 15,094,611 Shares
($.01 Par Value) (Outstanding at October 28, 1996)
(Class of Stock)
<PAGE>
SWIFT ENERGY COMPANY
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
INDEX
<TABLE>
<S> <C>
PART I. FINANCIAL INFORMATION PAGE
Item 1. Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheets
- September 30, 1996 and December 31, 1995 3
Condensed Consolidated Statements of Income
- For the Three-month and Nine-month periods
ended September 30, 1996 and 1995 5
Condensed Consolidated Statements of Stockholders' Equity
- September 30, 1996 and December 31, 1995 6
Condensed Consolidated Statements of Cash Flows
- For the Nine-month periods ended September 30, 1996 and 1995 7
Notes to Condensed Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 14
PART II. OTHER INFORMATION
Items 1-6. None 21
SIGNATURES 22
</TABLE>
<PAGE>
SWIFT ENERGY COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, 1996 December 31, 1995
------------------ -----------------
(Unaudited) (Note 1)
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 1,985,790 $ 7,574,512
Accounts Receivable -
Oil and gas sales 5,350,643 14,765,336
Associated limited partnerships
and joint ventures 5,666,250 16,108,298
Joint interest owners 4,680,739 4,044,817
Other current assets 691,858 887,491
----------------- -----------------
Total Current Assets 18,375,280 43,380,454
----------------- -----------------
Property and Equipment:
Oil and gas, using full-cost accounting
Proved properties being amortized 180,608,559 132,673,707
Unproved properties not being amortized 26,259,045 20,652,151
----------------- -----------------
206,867,604 153,325,858
Furniture, fixtures, and other equipment 5,763,745 4,367,719
----------------- -----------------
212,631,349 157,693,577
Less-accumulated depreciation, depletion,
and amortization (41,397,417) (30,169,303)
----------------- -----------------
171,233,932 127,524,274
----------------- -----------------
Other Assets:
Receivables from associated limited
partnerships, net of current portion 1,950,415 2,332,355
Limited partnership formation and
marketing costs 767,682 858,559
Deferred charges and other 533,203 1,157,065
----------------- -----------------
3,251,300 4,347,979
----------------- -----------------
$192,860,512 $175,252,707
================= =================
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE>
SWIFT ENERGY COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, 1996 December 31, 1995
------------------ -----------------
(Unaudited) (Note 1)
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities $ 15,125,829 $ 23,075,982
Payable to associated limited partnerships 1,787,718 16,983
Undistributed oil and gas revenues 7,460,407 17,040,304
----------------- -----------------
Total Current Liabilities 24,373,954 40,133,269
----------------- -----------------
Long-Term Debt ---- 28,750,000
Bank Borrowings 17,170,000 ----
Deferred Revenues 4,814,573 6,063,467
Deferred Income Taxes 12,159,655 6,960,006
Commitments and Contingencies
Stockholders' Equity:
Preferred stock, $.01 par value, 5,000,000
shares authorized, none outstanding ---- ----
Common stock, $.01 par value, 35,000,000
shares authorized, 15,091,384 and 12,509,700
shares issued and outstanding, respectively 150,914 125,097
Additional paid-in capital 100,701,877 71,133,979
Retained earnings 33,489,539 22,086,889
----------------- -----------------
134,342,330 93,345,965
----------------- -----------------
$192,860,512 $175,252,707
================= =================
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE>
SWIFT ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------ -------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES:
Oil and gas sales $13,226,521 $5,465,881 $33,733,101 $15,208,354
Fees from limited partnerships and
joint ventures 455,372 91,074 615,698 339,157
Supervision fees 1,150,129 973,694 3,277,111 2,838,170
Interest income 9,185 113,506 35,272 132,116
Other, net 590,986 404,779 1,517,749 1,354,635
------------ ----------- ----------- -----------
15,432,193 7,048,934 39,178,931 19,872,432
------------ ----------- ----------- -----------
COST AND EXPENSES:
General and administrative,
net of reimbursement 1,749,141 1,217,880 4,600,875 3,969,942
Depreciation, depletion, and
amortization 4,414,252 2,136,058 11,314,174 6,138,496
Oil and gas production 2,090,227 1,764,072 5,748,935 5,100,864
Interest expense, net ---- 193,161 293,907 1,283,485
------------ ----------- ----------- -----------
8,253,620 5,311,171 21,957,891 16,492,787
------------ ----------- ----------- -----------
Income Before Income Taxes 7,178,573 1,737,763 17,221,040 3,379,645
Provision for Income Taxes 2,536,620 473,207 5,818,390 859,214
------------ ----------- ----------- -----------
Net Income $4,641,953 $1,264,556 $11,402,650 $2,520,431
============ =========== =========== ===========
Per Share Amounts -
Primary $0.33 $0.12 $0.87 $0.32
===== ===== ===== =====
Fully diluted $0.31 $0.11 $0.87 $0.32
===== ===== ===== =====
Weighted Average Shares Outstanding 14,246,832 10,571,125 13,139,558 7,994,703
============ =========== =========== ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
<PAGE>
SWIFT ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Additional
Common Stock (1) Paid-In Retained
Capital Earnings Total
--------------- --------- --------- -------
<S> <C> <C> <C> <C>
Balance, December 31, 1994 $66,851 $24,885,903 $17,174,377 $42,127,131
Stock issued for benefit plans (31,113 shares) 311 283,463 ---- 283,774
Stock options exercised (5,761 shares) 58 33,736 ---- 33,794
Employee stock purchase plan (37,689 shares) 377 289,465 ---- 289,842
Stock issued in public offering (5,750,000 shares) 57,500 45,641,412 ---- 45,698,912
Net income ---- ---- 4,912,512 4,912,512
----------- ------------ ---------- ----------
Balance, December 31, 1995 $125,097 $71,133,979 $22,086,889 $93,345,965
Stock issued for benefit plans (30,014 shares)(2) 300 349,645 ---- 349,945
Stock options exercised (172,175 shares)(2) 1,722 1,317,057 ---- 1,318,779
Employee stock purchase plan (36,387 shares)(2) 364 272,178 ---- 272,542
Debenture conversion (2,343,108 shares)(2) 23,431 27,629,018 ---- 27,652,449
Net income(2) ---- ---- 11,402,650 11,402,650
----------- ------------ ---------- ----------
Balance, September 30, 1996 (2) $150,914 $100,701,877 $33,489,539 $134,342,330
=========== ============ =========== ============
</TABLE>
(1) $.01 Par Value
(2) Unaudited
See accompanying notes to condensed consolidated financial statements.
6
<PAGE>
SWIFT ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
1996 1995
---- ----
<S> <C> <C>
Cash Flows From Operating Activities:
Net income $ 11,402,650 $ 2,520,431
Adjustments to reconcile net income to net
cash provided by operating activities -
Depreciation, depletion, and amortization 11,314,174 6,138,496
Deferred income taxes 5,153,481 654,975
Deferred revenue amortization related to production payment (1,259,680) (1,349,253)
Other 86,597 84,168
Change in assets and liabilities -
(Increase) decrease in accounts receivable 365,321 (111,746)
Increase (decrease) in accounts payable and accrued
liabilities, excluding income taxes payable (1,289,771) 559,529
Increase in income taxes payable 578,559 50,584
------------ ------------
Net Cash Provided by Operating Activities 26,351,331 8,547,184
------------ ------------
Cash Flows From Investing Activities:
Additions to property and equipment (55,996,465) (21,076,168)
Proceeds from the sale of property and equipment 1,149,570 ----
Net cash received (distributed) as operator of oil
and gas properties (6,056,094) (628,288)
Property acquisition costs (incurred on behalf of)
reimbursed by partnerships and joint ventures 10,823,988 5,707,418
Limited partnership formation and marketing costs ---- (354,260)
Prepaid drilling costs (336,758) (102,088)
Other (75,274) 5,573
------------ ------------
Net Cash Used in Investing Activities (50,491,033) (16,447,813)
------------ ------------
Cash Flows From Financing Activities:
Net proceeds from bank borrowings 17,170,000 (27,229,000)
Net proceeds from issuances of common stock 1,949,730 46,312,013
Loan to ESOP Plan (568,750) ----
------------ ------------
Net Cash Provided by Financing Activities 18,550,980 19,083,013
------------ ------------
Net Increase (Decrease) in Cash and Cash Equivalents (5,588,722) 11,182,384
Cash and Cash Equivalents at Beginning of Period 7,574,512 985,498
------------ ------------
Cash and Cash Equivalents at End of Period $ 1,985,790 $ 12,167,882
============ ============
Supplemental disclosures of cash flow information
Cash paid during period for interest, net of amounts capitalized $ 1,168,768 $ 732,130
Cash paid during period for income taxes $ 84,992 $ 163,655
</TABLE>
See accompanying notes to condensed consolidated financial statements.
7
<PAGE>
SWIFT ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1996 (UNAUDITED) AND DECEMBER 31, 1995
(1) GENERAL INFORMATION
The condensed consolidated financial statements included herein have
been prepared by Swift Energy Company (the "Company") and are unaudited,
except for the balance sheet at December 31, 1995 which has been prepared
from the audited financial statements at that date. The financial
statements reflect necessary adjustments, all of which were of a
recurring nature, and 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 omitted pursuant to the rules
and regulations of the Securities and Exchange Commission (SEC). The
Company believes that the disclosures presented are adequate to allow the
information presented not to be misleading. The condensed consolidated
financial statements should be read in conjunction with the audited
financial statements and the notes thereto included in the latest Form
10-K and Annual Report.
Certain reclassifications have been made to the prior year balances
to conform to current year presentation.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Oil and Gas Properties
----------------------
For financial reporting purposes, the Company follows the "full-cost"
method of accounting for oil and gas property and equipment costs. Under
this method of accounting, all productive and nonproductive costs
incurred in the acquisition, exploration, and development of oil and gas
reserves are capitalized. Such costs include lease acquisitions,
geological and geophysical services, drilling, completion, equipment, and
certain general and administrative costs directly associated with
acquisition, exploration, and development activities. General and
administrative costs related to production and general overhead are
expensed as incurred.
No gains or losses are recognized upon the sale or disposition of oil
and gas properties, except in transactions that involve a significant
amount of reserves. The proceeds from the sale of oil and gas properties
are generally treated as a reduction of oil and gas property costs. Fees
from associated oil and gas exploration and development limited
partnerships are credited to oil and gas property costs to the extent
they do not represent reimbursement of general and administrative
expenses currently charged to expense.
Future development, site restoration, and dismantlement and
abandonment costs, net of salvage values, are estimated on a
property-by-property basis based on current economic conditions and are
amortized to expense as the Company's capitalized oil and gas property
costs are amortized. The Company's properties are all onshore and
historically the salvage value of the tangible equipment offsets the
Company's site restoration and dismantlement and abandonment costs. The
Company expects this relationship will continue.
The Company computes the provision for depreciation, depletion, and
amortization of oil and gas properties on the unit-of-production method.
Under this method, the Company computes the provision by multiplying the
total unamortized cost of oil and gas properties - including future
development, site restoration, and dismantlement and abandonment costs
but excluding costs of unproved properties - by an overall rate
determined by dividing the physical units of oil and gas produced during
the period by the total estimated units of proved oil and gas reserves.
The cost of unproved properties not being amortized is assessed quarterly
to determine whether the value has been impaired below the capitalized
cost. Any impairment assessed is added to the cost of proved properties
being amortized.
8
<PAGE>
SWIFT ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
SEPTEMBER 30, 1996 (UNAUDITED) AND DECEMBER 31, 1995
At the end of each quarterly reporting period, the unamortized cost
of oil and gas properties, net of related deferred income taxes, is
limited to the sum of the estimated future net revenues from proved
properties using current prices, discounted at 10%, and the lower of cost
or fair value of unproved properties, adjusted for related income tax
effects.
Deferred Charges and Other
--------------------------
Legal and accounting fees, underwriting fees, printing costs, and
other direct expenses associated with the issuance of the Company's 6.5%
Convertible Subordinated Debentures due 2003 (the "Debentures") in June
1993 have been capitalized and through June 30, 1996 were being amortized
over the life of the Debentures. Due to the conversion of all outstanding
Debentures into Common Stock in August 1996, as discussed below, related
unamortized costs ($1,097,551) were transferred to the Company's
appropriate capital accounts in the third quarter of 1996.
All of the amounts under deferred charges and other at September 30,
1996 relate to the Company's Employee Stock Ownership Plan ("ESOP"),
effective as of January 1, 1996. All employees over the age of 21 with
one year of service are participants. The Plan has a five year cliff
vesting and service is recognized after the Plan effective date. The ESOP
is designed to enable employees of the Company to accumulate stock
ownership. While there will be no employee contributions, participants
will receive an allocation of stock which has been contributed by the
Company. The Plan may also acquire Swift Energy Company Common Stock
purchased at fair market value. The ESOP can borrow money from the
Company to buy Company stock as was done in September 1996 to purchase
25,000 shares from the Company's Chairman. Benefits will be paid in a
lump sum or installments, and the participant generally has the choice of
receiving cash or stock.
Hedging Activities
------------------
The Company's revenues are primarily the result of sales of its oil
and natural gas production. Market prices of oil and natural gas may
fluctuate and adversely affect operating results. To mitigate a portion
of this risk, the Company engages periodically in certain limited hedging
activities, but only to the extent of buying put options as price floors
for portions of its and the limited partnerships' oil and gas production.
Costs and/or benefits derived from these price floors are accordingly
recorded as a reduction or increase in oil and gas sales revenue and were
not significant for any period presented.
Deferred Revenues
-----------------
In May 1992, the Company purchased interests in certain wells from
the Manville Corporation for $13.8 million using funds provided by the
Company's sale of a volumetric production payment in these properties to
a subsidiary of Enron Corp. Under the terms of the production payment
agreement, the Company continues to own the properties purchased but is
required to deliver a minimum quantity of hydrocarbons produced from the
properties (meeting certain quality and heating equivalent requirements)
over specified periods through October 2000. Since entering into this
agreement, the Company has met all scheduled deliveries. Volumes
remaining to be delivered under the volumetric production payment
(approximately 3.3 Bcf at September 30, 1996) are not included in the
Company's proved reserves. Net proceeds from the sale of the production
payment were recorded as deferred revenues. Deliveries under the
production payment are recorded as oil and gas sales revenues and a
corresponding reduction of deferred revenues. Hydrocarbons produced in
excess of the amount required to be delivered are sold by the Company for
its own account.
9
<PAGE>
SWIFT ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
SEPTEMBER 30, 1996 (UNAUDITED) AND DECEMBER 31, 1995
Limited Partnerships and Joint Ventures
---------------------------------------
Between 1991 and 1995, the Company formed limited partnerships and
joint ventures for the purpose of acquiring interests in producing oil
and gas properties, and since 1993, partnerships engaged in drilling for
oil and gas reserves. The Company serves as managing general partner or
manager of these entities. The Company's investments in associated oil
and gas partnerships and its joint ventures are accounted for using the
proportionate consolidation method, whereby the Company's proportionate
share of each entity's assets, liabilities, revenues, and expenses is
included in the appropriate classifications in the Company's Consolidated
Financial Statements. Because the Company serves as the general partner
of these entities, under state partnership law it is contingently liable
for the liabilities of these partnerships, virtually all of which is owed
to the Company, and are not material for any of the periods presented in
relation to the partnerships' respective assets.
Under the Swift Depository Interests limited partnership offering
("SDI Offering") which commenced in March 1991 and concluded in December
1995, the Company received a reimbursement of certain costs and a fee,
both payable out of revenues. The Company bore all front-end costs of the
offering and partnership formations for which it received an interest in
the partnerships. Upon the Company's decision to conclude the SDI
offering at the end of 1995, the remaining limited partnership formation
and marketing costs related to the SDI offering (approximately
$1,750,000) were accordingly transferred to the oil and gas properties
account.
Commencing September 15, 1993, the Company began offering, on a
private placement basis, general and limited partnership interests in
limited partnerships formed to drill for oil and gas. As managing general
partner, the Company pays for all front-end costs incurred in connection
with these offerings, for which the Company receives an interest in the
partnerships. Through September 30, 1996, approximately $34,800,000 had
been raised in seven partnerships, one formed in each of 1993 and 1994,
three in 1995, and two in 1996. In July and September 1996, the Company
closed the sixth and seventh partnerships with total subscriptions of
approximately $4,900,000 and $10,000,000, respectively. Costs of
syndication, registration, and qualification of these limited
partnerships incurred by the Company have been deferred. Under the
current private limited partnership offerings, selling and formation
costs borne by the Company serve as the Company's general partner
contribution to such partnerships.
Income Taxes
------------
The Company accounts for income taxes using the Statement of
Financial Accounting Standards (SFAS) No. 109, "Accounting for Income
Taxes." SFAS No. 109 utilizes the liability method and deferred taxes are
determined based on the estimated future tax effects of differences
between the financial statement and tax bases of assets and liabilities
given the provisions of the enacted tax laws.
Income taxes for the interim periods have been provided using the
estimated annualized effective tax rate.
10
<PAGE>
SWIFT ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
SEPTEMBER 30, 1996 (UNAUDITED) AND DECEMBER 31, 1995
Income Per Share
----------------
Primary income per share has been computed using the weighted average
number of common shares outstanding during the respective periods. Stock
options and warrants outstanding do not have a dilutive effect on primary
income per share. The Company's Debentures were not Common Stock
equivalents for the purpose of computing primary income per share.
The calculation of fully diluted income per share assumed conversion
of the Company's Debentures as of the beginning of the period and the
elimination of the related after-tax interest expense and assumed, as of
the beginning of the period, exercise (using the treasury stock method)
of stock options and warrants. The weighted average number of shares used
in the computation of fully diluted per share amounts were 13,647,445 and
14,754,719 for the respective nine-month and three-month periods ended
September 30, 1996. Due to the August 1996 conversion of these Debentures
into 2.34 million shares of Common Stock, as described below, the effect
of such conversion is included in primary income per share for the third
quarter of 1996 and for future periods.
(3) BANK BORROWINGS
The Company has available through a two bank-group, a revolving line
of credit. Effective April 30, 1996, this credit agreement was restated.
The facility was increased to $100,000,000 and is now unsecured. The
available borrowing base currently is $30,000,000, and will be
redetermined periodically. Depending on the level of outstanding debt,
the interest rate currently will be either the bank's base rate or the
bank's base rate plus 0.25% (8.25% at September 30, 1996). This facility
also allows, at the Company's option, draws which bear interest for
specific periods at the London Interbank Offered Rate ("LIBOR"). The
LIBOR option will now vary from plus 1% to plus 1.5%. There was no
outstanding balance under this line of credit at December 31, 1995. At
September 30, 1996, $17,000,000 was outstanding under this line, all
bearing interest under the LIBOR rate option at rates ranging from 6.562%
to 6.8125%. The outstanding amount under this facility at September 30,
1996 was borrowed primarily to fund the Company's working capital needs
and capital expenditures. The restated revolving line of credit extends
through September 30, 1999, and accordingly is classified on the balance
sheet as a long-term liability.
The terms of the revolving line of credit include, among other
restrictions, a limitation on the level of cash dividends (not to exceed
$2,000,000 in any fiscal year), requirements as to maintenance of certain
minimum financial ratios (principally pertaining to working capital,
debt, and equity ratios) and limitations on incurring other debt. Since
inception, no cash dividends have been declared on the Company's Common
Stock. The Company presently intends to continue a policy of using
retained earnings for expansion of its business. As of September 30, 1996
and December 31, 1995, the Company was in compliance with the provisions
of these agreements.
The Company's other credit facility, which is the Company's only
secured facility, is an amended and restated revolving line of credit
with the lead bank of the two bank-group, secured by certain Company
receivables. This facility, effective April 30, 1996, was amended to
$7,000,000 (from $5,000,000), with interest at the bank's base rate less
0.25% (8% at September 30, 1996). At September 30, 1996, $170,000 was
outstanding under this facility. There was no outstanding amount on this
facility at December 31, 1995. This restated credit facility extends
through September 30, 1999, and is also recorded as a long-term
liability.
In addition to interest on these credit facilities, the Company pays
a commitment fee to compensate the banks for making funds available. The
fee on the revolving line of credit is calculated on the average daily
remainder, if any, of the commitment amount less the aggregate principal
amounts outstanding plus the amount of all outstanding letters of credit
during the period. The aggregate amounts of commitment fees paid by the
Company were $140,000 for the first nine months of 1996 and $154,000 for
the twelve-month period in 1995.
11
<PAGE>
SWIFT ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
SEPTEMBER 30, 1996 (UNAUDITED) AND DECEMBER 31, 1995
(4) LONG-TERM DEBT
The Company's long-term debt previously consisted of $28,750,000 of
6.5% Convertible Subordinated Debentures due 2003. The Debentures were
issued on June 30, 1993, under terms making them convertible into Common
Stock of the Company by the holders at any time prior to maturity at an
adjusted conversion price of $12.27 per share. Interest on the Debentures
was payable semiannually on June 30 and December 31, commencing with the
payment made at December 31, 1993. The Debentures become redeemable for
cash at the option of the Company after June 30, 1996 at 104.55% of
principal.
On July 1, 1996, the Company called all of the Debentures for
redemption on August 5, 1996 at 104.55% of their face amount, plus
accrued interest since June 30, 1996. The Debentures continued to be
convertible into shares of Common Stock at $12.27 per share through
August 5, 1996. Prior to the redemption date, the holders of all of the
outstanding Debentures elected to convert their Debentures into shares of
Common Stock, resulting in the issuance of 2.34 million shares of Common
Stock in August 1996.
Upon conversion of the Debentures into Common Stock, the approximate
$27,650,000 net carrying amount of the debt (the face amount less
unamortized deferred charges) was transferred to the Company's
appropriate capital accounts during the third quarter of 1996.
Interest expense on the Debentures, including amortization of debt
issuance costs, totaled $993,890 for the six-month period ending June 30,
1996, the last interest payment date prior to conversion, and $1,981,639
for the twelve-month period ending December 31, 1995.
(5) STOCKHOLDERS' EQUITY
During the third quarter of 1995, the Company closed the sale to the
public of 5,750,000 shares of Common Stock at a price of $8.50 per share.
Net proceeds from this offering were $45,698,912 and were used to repay
outstanding indebtedness, with the remaining proceeds being used to
finance the Company's exploration and development activities, and to
acquire producing oil and gas properties, including limited partnership
interests.
In August 1996, the holders of the Company's Debentures converted
such Debentures into 2.34 million shares of the Company's Common Stock,
which resulted in a third quarter 1996 increase in the Company's capital
accounts of approximately $27,650,000.
12
<PAGE>
SWIFT ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
SEPTEMBER 30, 1996 (UNAUDITED) AND DECEMBER 31, 1995
(6) FOREIGN ACTIVITIES
Russia
------
On September 3, 1993, the Company signed a Participation Agreement
with Senega, a Russian Federation joint stock company (in which the
Company has an indirect interest of less than 1%), to assist in the
development and production of reserves from two fields in Western
Siberia, providing the Company with a minimum 5% net profits interest
from the sale of hydrocarbon products from the fields for providing
managerial, technical, and financial support to Senega. Additionally, the
Company purchased a 1% net profits interest from Senega for $300,000. In
May 1995, the Company executed a Management Agreement with Senega, under
which, in return for undertaking to obtain financing for development of
these fields, Swift is entitled to receive a 49% interest in production
income derived by Senega from this project after repayment of costs.
On July 12, 1996, the Company entered into a partnership agreement
which provides for the Company to contribute its rights under the
Participation and Management Agreement to the partnership and for the
partners to share equally revenues and costs of developing the Samburg
Field and funding and management of the license areas, all in conjunction
with Senega. The partnership is to be funded by the partners upon
fulfillment of certain conditions and completion of certain further
arrangements with Senega. It is currently anticipated that these
activities would be funded principally through project financing. At
September 30, 1996, the Company's investment in Russia was approximately
$9,220,000, and is included in the unproved properties portion of oil and
gas properties.
Venezuela
---------
The Company formed a wholly-owned subsidiary, Swift Energy de
Venezuela, C.A., for the purpose of submitting a bid on August 5, 1993,
under the Venezuelan Marginal Oil Field Reactivation Program. Although,
the Company did not win the bids, it is continuing to pursue cooperative
ventures involving other fields and opportunities in Venezuela. At
September 30, 1996, the Company's investment in Venezuela was
approximately $1,390,000 and is included in the unproved properties
portion of oil and gas properties net of impairments of $45,668.
New Zealand
-----------
Since October 1995, the Company has been issued two Petroleum
Exploration Permits by the New Zealand Minister of Energy. The first
permit covers approximately 65,000 acres in the Onshore Taranaki Basin
region in the Southwestern area of New Zealand's North Island, and the
second covers approximately 71,500 adjacent acres. Under the terms of the
permits, the Company is obligated to analyze and interpret certain
seismic data, acquire certain new seismic data, drill one exploratory
well, followed by a further development well or perform additional
seismic work, all of which is to be performed on a staged basis in order
to maintain the permits, over periods extending through July 2000 in the
case of the first permit, and July 2001 for the second permit. At
September 30, 1996, the Company's investment in New Zealand was
approximately $565,000 and is included in the unproved properties portion
of oil and gas properties.
(7) SUBSEQUENT EVENT
On October 24, 1996, the Company filed with the Securities and
Exchange Commission a registration statement for a public offering of
$100,000,000 of Convertible Subordinated Notes due 2006. Proceeds of the
offering will be used to repay all of the Company's outstanding
indebtedness, to finance development and exploration drilling activities,
and to acquire oil and gas properties or used for other general corporate
purposes.
13
<PAGE>
SWIFT ENERGY COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the
Company's Condensed Consolidated Financial Statements and Notes thereto.
GENERAL
The Company was formed in 1979, and from 1985 to 1991 grew primarily
through the acquisition of producing properties funded through limited
partnership financing. Commencing in 1991, the Company began to
reemphasize the addition of reserves through increased exploration and
development drilling activity while significantly reducing its reliance
on limited partnership financing. This emphasis on exploration and
development drilling has led to additions of increasing quantities of
reserves in each of 1994, 1995, and the first nine months of 1996.
The statements contained in this Quarterly Report on Form 10-Q
("Quarterly Report") that are not historical facts are forward-looking
statements as that term is defined in Section 21E of the Securities and
Exchange Act of 1934, as amended, and therefore that involve a number of
risks and uncertainties. The actual results of the future events
described in such forward-looking statements in this Quarterly Report
including those regarding the Company's financial results, levels of oil
and gas production or revenue, capital expenditures, and capital resource
activities could differ materially from those estimated. Among the
factors that could cause actual results to differ materially are: general
economic conditions, competition and government regulations, and
fluctuations in oil and natural gas prices, as well as the risks and
uncertainties set forth from time to time in the Company's other public
reports, filings, and public statements. Also, because of the volatility
in oil and gas prices and other factors, interim results are not
necessarily indicative of those for a full year.
LIQUIDITY AND CAPITAL RESOURCES
In 1991, the Company's strategy shifted toward increased reliance on
exploration and development drilling activities, and the Company has
significantly expanded reserves added through these efforts. Previously,
the Company relied on limited partnership capital as its principal
financing vehicle to fund its acquisitions of producing properties. As a
result of this shift in strategy, the Company has reduced its reliance on
cash flows generated from, and capital raised through, limited
partnerships. Supplemental cash and working capital are provided through
internally generated cash flows and debt and equity financing.
During the first half of 1995, the Company used a combination of bank
financing, internally generated cash flows and partnership financing to
fund its operations. In the third quarter of 1995, the Company realized
$45,698,912 in net proceeds from an offering of Common Stock that
provided sufficient capital to repay its bank financing and finance its
capital expenditures for the second half of 1995. During the first nine
months of 1996, the Company relied upon internally generated cash flows
and bank borrowings to fund its capital expenditures. Described below are
the major elements of the Company's liquidity and capital resources:
Net Cash Provided by Operating Activities
-----------------------------------------
For the nine month period ended September 30, 1996, net cash provided
by operating activities increased significantly (208%) to $26,351,331, as
compared to $8,547,184 during the first nine months of 1995. The 1996
increase of $17,804,147 was primarily due to an increase in cash flows
from oil and gas sales, which increased $18,614,320 (134%), exclusive of
the noncash amortization of deferred revenues associated with the
Company's volumetric production payment. This increase in oil and gas
sales was primarily the result of the Company's recent increase in
drilling activity as described below.
14
<PAGE>
SWIFT ENERGY COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED
1995 Stock Offering
-------------------
During the third quarter of 1995, the Company sold 5,750,000 shares
of Common Stock in a public offering at $8.50 per share, with net
proceeds of $45,698,912. Net proceeds from the offering were used to
repay outstanding indebtedness, and the remainder of the proceeds have
been used to finance the Company's exploration and development
activities, and to acquire producing oil and gas properties, including
limited partnership interests.
Other Financing Activities
--------------------------
Convertible Subordinated Debentures. On June 30, 1993, the Company
issued 6.5% Convertible Subordinated Debentures due 2003 in the amount of
$28,750,000 in a public offering. Proceeds of the offering were used
primarily to acquire producing oil and gas properties and to finance the
Company's expanding exploration and development programs. As described in
Note 4 to the Company's Condensed Consolidated Financial Statements
included herein, in August 1996 the Debentures were converted by their
holders into 2.34 million shares of the Company's Common Stock following
the Company's July 1996 announcement that the Debentures would be
redeemed in August 1996, unless earlier converted. As a result of this
conversion, the Company's stockholders' equity increased approximately
$27,650,000.
Partnership Programs. Between 1991 and 1995, the Company offered
interests in oil and gas production partnerships under its Swift
Depository Interests ("SDI") offering, and since late 1993 has offered
private partnerships formed to drill for oil and gas. The SDI program
concluded at the end of 1995. Four SDI partnerships were formed during
1995, with total subscriptions of approximately $12,400,000. During 1995,
the Company closed three drilling partnerships with a total of
$15,900,000 of subscriptions. In the first nine months of 1996 two
drilling partnerships were formed, both in the third quarter, with total
subscriptions of approximately $14,900,000. The Company anticipates that
it will continue to offer the drilling partnerships for the foreseeable
future.
At September 30, 1996, limited partnership formation and marketing
costs (which under the current drilling partnership offerings are borne
by the Company as part of the Company's general partner contribution)
amounted to $767,682, a decrease of $90,877, when compared with the
December 31, 1995 balance. Upon the Company's decision to conclude the
SDI offering in December 1995, the remaining limited partnership
formation and marketing costs related to the SDI offering (approximately
$1,750,000) were transferred to the oil and gas properties account.
Credit Facilities
-----------------
Recently, the Company's credit facilities have been used to fund a
portion of the Company's exploration and development activities.
Formerly, the Company established credit facilities which were used
principally to finance the Company's purchase of producing oil and gas
properties on an interim basis pending transfer of the properties to
newly formed partnerships and joint ventures, and to provide working
capital. These credit facilities consist of a $100,000,000 unsecured
revolving line of credit with a $30,000,000 borrowing base, and a
$7,000,000 secured revolving line of credit. The principal terms and
restrictions of these credit facilities are described in Note 3 to the
Company's Condensed Consolidated Financial Statements included herein.
15
<PAGE>
SWIFT ENERGY COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED
At September 30, 1996, the Company had $17,170,000 outstanding under
these borrowing arrangements which was used, along with internally
generated cash flows of $26,351,000, principally to fund the Company's
capital expenditures in the first nine months of 1996, and to a lesser
extent, to provide working capital. The Company will continue to use
these facilities until completion of the pending debt offering referenced
in Note 7 to the Company's Condensed Consolidated Financial Statements
included herein. At December 31, 1995, the Company had no outstanding
balances under these borrowing arrangements, as these borrowings were
repaid with proceeds from the Company's 1995 stock offering.
Working Capital
---------------
The Company's working capital has decreased over the last nine
months, from $3,247,185 at December 31, 1995, to a working capital
deficit of $5,998,674 at September 30, 1996. This decrease is primarily
the result of the Company's capital expenditures as described below.
Since year end 1995, the Company's receivable account from limited
partnerships decreased significantly due to (a) receipt of approximately
$7,800,000 generated from property sales proceeds realized by these
partnerships, and (b) an increase in oil and gas prices received by these
partnerships. Both increased the cash flows of these partnerships, thus
allowing them to reduce their balances owed to the Company.
Due to the nature of the Company's business highlighted above, the
individual components of working capital fluctuate considerably from
period to period. The Company incurs significant working capital
requirements in connection with its role as operator of approximately 800
wells, its accelerated drilling program, and the management of affiliated
partnerships. In this capacity, the Company is responsible for certain
day-to-day cash management, including the collection and disbursement of
oil and gas revenues and related expenses.
Capital Expenditures
--------------------
Capital expenditures for property, plant, and equipment during the
first nine months of 1996 were $55,996,465. These capital expenditures
included: (a) $42,400,000 of drilling costs, both exploratory and
developmental, (b) $9,200,000 of prospect costs (principally prospect
leasehold, seismic and geological costs of unproved prospects for the
Company's account), (c) $3,000,000 invested in foreign business
opportunities in Russia (approximately $2,400,000), in Venezuela
(approximately $300,000), and in New Zealand (approximately $300,000), as
described in Note 6 to the Company's Condensed Consolidated Financial
Statements included herein; and (d) $1,400,000 spent for computer
equipment and furniture and fixtures. In the remaining three months of
1996, the Company expects capital expenditures to be approximately
$25,000,000, including investments in all areas in which investments were
made during the first nine months of the year as described above, with a
particular focus on exploratory and development drilling. The Company
currently plans to participate in the drilling of 162 gross wells this
year, compared to 76 wells in 1995. Through September 30, 1996, the
Company had participated in drilling 102 wells (6 exploratory and 96
development wells with 4 exploratory successes and 92 development
successes). The steady growth in the Company's unproved property account
which is not being amortized is indicative of the shift to a focus on
drilling activity, as the Company acquires prospect acreage. During the
first nine months of 1996, this account also reflects $3,000,000 of
capital expenditures made in relation to the Company's foreign business
opportunities, as described above.
16
<PAGE>
SWIFT ENERGY COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED
The anticipated net proceeds in the fourth quarter from the sale of
$100,000,000 of the Convertible Subordinated Notes due 2006, as described
in Note 7 to the Company's Condensed Consolidated Financial Statements
included herein, after repayment of the Company's outstanding
indebtedness, will be added to working capital to fund the Company's
development and exploration drilling projects and possibly to acquire oil
and gas properties, or used for other general corporate purposes. The
Company believes the proceeds of such offering and anticipated internally
generated cash flows (expected to increase as the Company's production
base increases as a result of its accelerated drilling program), will be
sufficient to finance the costs associated with its currently budgeted
capital expenditures of over $134.0 million for the remaining three
months of 1996 and for 1997. Further liquidity needs may also be met by
its existing credit facilities.
RESULTS OF OPERATIONS
Comparison of Nine Months Ended September 30, 1996 and 1995
-----------------------------------------------------------
Net income of $11,402,650 and earnings per share of $0.87 for the
first nine months of 1996 were 352% and 172% higher, respectively, than
net income of $2,520,431, and earnings per share of $0.32 in the same
period for 1995. This increase in net income primarily reflected the
effect of a 122% increase in oil and gas sales revenues as a result of a
98% increase in natural gas production, a 17% increase in crude oil
production, and product price improvements. The lower percentage increase
in earnings per share reflects a 64% increase in weighted average shares
outstanding for the period, as a result of the sale of 5.75 million
shares of Common Stock in the third quarter of 1995, and the conversion
of the Debentures into 2.34 million shares of Common Stock in the third
quarter of 1996.
Revenues
The Company's revenues increased 97% during the first nine months of
1996 from the comparative period in 1995, due primarily to the increase
in oil and gas sales. Oil and gas sales increased 122% to $33,733,101 in
the first three quarters of 1996, compared to $15,208,354 for the
comparative period in 1995. The 98% increase in natural gas production
and the 17% increase in oil production were primarily the result of
production from recent drilling activity, most notably from the Company's
two primary development areas, the AWP Olmos Field and the Austin Chalk
trend. The Company's net sales volume (including the volumetric
production payment) in the first nine months of 1996 increased by 73% or
5,742,712 Mcfe (thousand cubic feet equivalent) over volumes in the
comparable 1995 period. Oil and gas sales were also aided by 21% and 40%
increases in average prices received for oil and gas, respectively,
between the two periods, as highlighted in the table below.
17
<PAGE>
SWIFT ENERGY COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED
Revenues from oil and gas sales comprised 86% and 77%, respectively,
of total revenues for the first nine months of 1996 and 1995. The
majority (74%) of these revenues were derived from the sale of the
Company's gas production. The Company expects oil and gas sales to
continue to increase as a direct consequence of the addition of oil and
gas reserves through the Company's active drilling program.
The following table provides additional information regarding the
Company's oil and gas sales.
<TABLE>
<CAPTION>
Net Sales Volume Average Sales Price
---------------- -------------------
Oil (Bbl) Gas (Mcf) Oil (Bbl) Gas (Mcf)
-------- -------- -------- --------
<S> <C> <C> <C> <C>
1995
----
3 Mos Ended 03-31-95 134,626 1,702,658 $15.61 $1.63
3 Mos Ended 06-30-95 121,551 1,751,375 $16.36 $1.64
3 Mos Ended 09-30-95 137,829 2,028,373 $14.94 $1.68
--------- ---------
9 Mos Ended 09-30-95 394,006 5,482,406 $15.61 $1.65
1996
----
3 Mos Ended 03-31-96 159,155 3,172,399 $17.78 $2.16
3 Mos Ended 06-30-96 150,124 3,501,426 $18.73 $2.29
3 Mos Ended 09-30-96 150,084 4,159,151 $20.45 $2.44
------- ---------
9 Mos Ended 09-30-96 459,363 10,832,976 $18.96 $2.31
</TABLE>
Supervision fees increased 15%, having grown from $2,838,170 in the
first nine months of 1995 to $3,277,111 in the first nine months of 1996.
This increase is primarily due to the annual escalation in April for well
overhead rates, and the increase in drilling activity by the Company,
which in turn increases the drilling well overhead portion of such fees.
Costs and Expenses
------------------
General and administrative expenses for the first three quarters of
1996 increased approximately $630,000 or 16% when compared to the same
period in 1995. However, the Company's general and administrative
expenses per Mcfe produced decreased by 33% from $0.51 per Mcfe produced
for the first nine months of 1995 to $0.34 per Mcfe produced for the
comparable period in 1996. The majority of the companies in the oil and
gas industry treat supervision fees as a reduction of their general and
administrative expenses. If the Company were to follow this practice,
these expenses net of supervision fees would have decreased from $0.14
per Mcfe produced for the first nine months of 1995 to $0.10 per Mcfe
produced for the same period in 1996.
18
<PAGE>
SWIFT ENERGY COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED
Depreciation, depletion, and amortization ("DD&A") increased 84%
(approximately $5,200,000) for the first nine months of 1996, primarily
due to the Company's reserve additions and associated costs, and the
related sale of increased quantities of oil and gas therefrom. The
Company's DD&A rate per Mcfe of production has increased from $0.78 per
Mcfe produced in the 1995 period to $0.83 per Mcfe produced in the 1996
period, reflecting variations in the per unit cost of reserve additions.
The Company's production costs per Mcfe decreased from $0.65 per Mcfe
produced in the 1995 period to $0.42 per Mcfe produced in the 1996
period. However, due to the increase in production volumes, oil and gas
production costs increased 13% (approximately $648,000) in the first nine
months of 1996 when compared to the first nine months of 1995. As
discussed above, the Company's increase in production is primarily
through its drilling activities in the AWP Olmos Field and Austin Chalk
trend, where the Company already has an established operating base. The
increase in production costs is partially offset by an exemption in these
same fields from the 7.5% Texas severance tax applicable to gas
production from certain natural gas wells certified to be in tight
formations or to be deep wells by the Texas Railroad Commission.
Additionally, commencing September 1, 1996, certain wells certified as
"high cost gas" wells will be entitled to a reduction of severance tax
based upon a formula amount. Therefore, the increase in drilling activity
and production has not been accompanied by a proportionate increase in
operating costs. This tax exemption has had a positive impact on the
Company's production costs during 1995 and 1996, although under the new
rules, the proportionate amount of the exemption may be reduced in future
periods.
Interest expense in the first nine months of 1996 on the Debentures,
including amortization of debt issuance costs, totaled $993,890
($1,485,730 in the 1995 period), while interest expense on the credit
facilities, including commitment fees, totaled $789,909 ($1,617,924 in
the 1995 period) for a total interest expense of $1,783,799 (of which
$1,489,892 was capitalized). In the first nine months of 1995 these costs
totaled $3,103,654 (of which $1,820,169 was capitalized). The Company
capitalizes that portion of interest related to its exploration,
partnership, and foreign business development activities. The decrease in
interest expense in 1996 is attributable to (1) the decrease in the
average balance under the Company's credit lines necessary to finance the
Company's capital expenditures, as discussed above, and (2) the Company
incurring only six months of interest in 1996, instead of nine months of
interest in 1995, on the Debentures which were converted into Common
Stock in the third quarter of 1996.
RESULTS OF OPERATIONS
Comparison of Three Months Ended September 30, 1996 and 1995
------------------------------------------------------------
Net income of $4,641,953 and earnings per share of $0.33 in the third
quarter of 1996 increased 267% and 175%, respectively, when compared to
net income of $1,264,556 and earnings per share of $0.12 in the same
period for 1995. The increase in net income was primarily due to the 142%
increase in oil and gas sales revenues as a result of a 105% increase in
natural gas production, a 9% increase in crude oil production, and
product price improvements. The lower percent increase in earnings per
share reflects an 35% increase in the weighted average shares outstanding
for the period, for the same reasons discussed above.
19
<PAGE>
SWIFT ENERGY COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED
Revenues
The Company's revenues increased 119% during the third quarter of
1996 from the comparative period in 1995, due primarily to the increase
in oil and gas sales. Oil and gas sales increased 142% to $13,226,521 in
the third quarter of 1996, compared to $5,465,881 for the comparative
period in 1995. The 105% increase in natural gas production and the 9%
increase in oil production were primarily the result of production from
recent drilling activity, most notably from the Company's two primary
development areas, the AWP Olmos Field and the Austin Chalk trend. The
Company's net sales volume (including the volumetric production payment)
in the third quarter of 1996 increased by 77% or 2,204,308 Mcfe over
volumes in the comparable 1995 period. Oil and gas sales were also aided
by 37% and 45% increases in average prices received for oil and gas,
respectively, between the two periods as highlighted in the table above.
Supervision fees increased 18% in the third quarter of 1996 when
compared to the same period in 1995. This increase is primarily due to
the annual escalation in April for well overhead rates, and the increase
in drilling activity by the Company, which in turn, increases the
drilling well overhead portion of such fees.
Costs and Expenses
------------------
General and administrative expenses for the third quarter of 1996
increased $531,261 or 44% when compared to the same period in 1995,
primarily the result of the strategic shift in the Company's activity
toward more direct corporate participation in projects which do not
result in reimbursement from other parties. However, on a Mcfe basis, the
Company's general and administrative expenses decreased from $0.43 per
Mcfe produced for the third quarter of 1995 to $0.35 per Mcfe produced
for the same period in 1996.
Depreciation, depletion, and amortization increased 107%
(approximately $2,300,000), primarily due to the reserve additions and
their associated costs, and the related sale of increased quantities of
oil and gas. The DD&A rate per Mcfe of production has increased from
$0.75 per Mcfe produced in the 1995 period to $0.87 per Mcfe produced in
the 1996 period, reflecting variations in the per unit cost of reserve
additions.
The Company's production costs per Mcfe decreased from $0.62 per Mcfe
produced in the 1995 period to $0.41 per Mcfe produced in the 1996
period. However, due to the increase in production volumes, oil and gas
production costs increased 18% (approximately $325,000) in the third
quarter of 1996 when compared to the third quarter of 1995. As described
above, this reflects the Company's economies of scale in the AWP Olmos
Field and the Austin Chalk trend, and the gas production severance tax
abatement these fields receive.
There was no interest expense for the third quarter of 1996 on the
Debentures as they were converted into Common Stock in the third
quarter ($495,910 in 1995), while interest expense on the credit
facilities, including commitment fees, totaled $312,510 ($308,640 in
1995) for a total of $312,510 (all of which was capitalized). The third
quarter 1995 total was $804,550 (of which $611,389 was capitalized).
20
<PAGE>
SWIFT ENERGY COMPANY
PART II. - OTHER INFORMATION
Item 1. Legal Proceedings - N/A
Item 2. Changes in Securities - N/A
Item 3. Defaults Upon Senior Securities - N/A
Item 4. Submission of Matters to a Vote of Security Holders - N/A
Item 5. Other Information - N/A
Item 6. Exhibits & Reports on Form 8K - None
21
<PAGE>
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 thereunto duly authorized.
SWIFT ENERGY COMPANY
(Registrant)
Date: October 30, 1996 By: (Original Signed By)
---------------- ------------------
John R. Alden
Sr. Vice President - Finance
Chief Financial Officer, Secretary
Date: October 30, 1996 By: (Original Signed By)
---------------- ------------------
Alton D. Heckaman, Jr.
Vice President,
Controller and Principal
Accounting Officer
22
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
registrant's financial statements contained in its quarterly report on Form
10-Q for the period ended September 30, 1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 1,985,790
<SECURITIES> 0
<RECEIVABLES> 17,648,047
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 18,375,280
<PP&E> 212,631,349
<DEPRECIATION> 41,397,417
<TOTAL-ASSETS> 192,860,512
<CURRENT-LIABILITIES> 24,373,954
<BONDS> 0
0
0
<COMMON> 150,914
<OTHER-SE> 134,191,416
<TOTAL-LIABILITY-AND-EQUITY> 192,860,512
<SALES> 33,733,101
<TOTAL-REVENUES> 39,178,931
<CGS> 0
<TOTAL-COSTS> 17,063,109<F1>
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 293,907
<INCOME-PRETAX> 17,221,040
<INCOME-TAX> 5,818,390
<INCOME-CONTINUING> 11,402,650
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 11,402,650
<EPS-PRIMARY> 0.87
<EPS-DILUTED> 0.87
<FN>
<F1>Includes depreciation, depletion and amortization and oil and gas
production costs. Excludes general and administrative and interest expense.
</FN>
</TABLE>
