SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 of 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 8, 2000
FORTUNE NATURAL RESOURCES CORPORATION
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(Exact name of Registrant as specified in its charter)
Delaware 1-12334 95-4114732
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
515 W. Greens Road, Suite 720, Houston, Texas 77067
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (281) 872-1170
Registrant's telecopier number, including area code: (281) 872-1213
N/A
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
MAY 8, 2000 - HOUSTON, TEXAS - FORTUNE NATURAL RESOURCES CORPORATION
(NASDAQ OTC BB SYMBOL: FPXA) today announced its financial results for the
quarter ended March 31, 2000.
First quarter 2000 versus first quarter of 1999
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Fortune incurred a net loss of $362,000, or $0.03 per share for the first
quarter of 2000, compared to a net loss of $553,000, or $0.05 per share, for the
same period in 1999. The lower 2000 loss results primarily from higher oil and
gas prices and a reduction in most costs for the first quarter 2000.
Fortune's oil and gas revenues increased 41% to $359,000 in the first
quarter of 2000 versus 1999 as higher oil and gas prices offset lower oil and
gas production. Gas prices increased 50% to $2.70 per Mcf during the first
quarter of 2000 versus $1.80 per Mcf for the same 1999 period. Oil prices
increased 175% to $27.44 per Bbl versus $9.99 per Bbl for 1999. Gas production
decreased 19% to 99,100 Mcf while oil production was unchanged for the first
quarter of 2000 as compared to the same period in 1999.
As previously announced, $930,000 of Fortune's 12% convertible notes were
converted into common stock during the first quarter of 2000. This conversion
resulted in the $28,000 decrease (29%) in Fortune's cash interest expense in the
first quarter of 2000 versus the same 1999 period. The conversion also reduced
Fortune's annual cash interest expense by $111,600, reduced total debt to
$2,305,000 and eliminated all of Fortune's notes that were convertible at $0.33
per share. To encourage conversion, Fortune paid the noteholders one year's
interest in Fortune stock valued at $0.75 per share. This interest paid in stock
was expensed as an extraordinary loss on early extinguishment of debt during the
first quarter of 2000. In the first quarter of 1999 Fortune incurred $74,000 of
non-cash interest expense which was comprised solely of amortization of deferred
financing costs that was fully amortized by April 1999.
General and administrative expense and depreciation, depletion and
amortization decreased 8% and 29%, respectively, for the first quarter of 2000
versus 1999. Production and operating expense increased 37% because of higher
production taxes and more wells producing in 2000 versus 1999.
Financing Transactions in First Quarter 2000
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As previously announced, during the first quarter of 2000, Fortune raised
$618,000 through a private placement of common stock at $0.75 per share and
$164,000 through the exercise of common stock purchase warrants at $0.75 per
share in an incentive exercise program. These transactions resulted in the
increase in cash and working capital to $804,000 and $927,000, respectively at
March 31, 2000 versus $294,000 and $302,000, respectively for December 31, 1999.
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FORTUNE NATURAL RESOURCES CORPORATION is an independent oil and gas
exploration and production company with its principal properties located onshore
and offshore Louisiana and Texas. Certain statements in this news release
regarding future expectations and plans may be regarded as "forward looking
statements" within the meaning of the Securities Exchange Act of 1934. They are
subject to various risks, such as operating hazards, drilling risks, and other
uncertainties inherent in the business of exploring for, developing and
producing oil and gas which may be beyond Fortune's control. For a discussion of
the contingencies and uncertainties affecting future events and forward-looking
statements, see Fortune's latest Report on Form 10-KSB/A, as well as other
filings with the Securities and Exchange Commission. There can be no assurance
that Fortune will be successful in meeting its expectations.
************
Company Contact: J. Michael Urban
Vice President and CFO
(281) 872-1170
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FORTUNE NATURAL RESOURCES CORPORATION
STATEMENTS OF OPERATIONS
($'s in thousands, except price and per share figures)
Three Months Ended
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March 31, March 31,
2000 1999
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(Unaudited)
REVENUES
Sales of oil and gas, net of royalties $ 359 $ 255
Other income 6 15
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365 270
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COSTS AND EXPENSES
Production and operating 123 90
Provision for depletion, depreciation and amortization 150 210
General and administrative 267 291
Debt conversion expense - 61
Interest payable in cash 69 97
Interest - amortization of deferred financing cost - 74
Provision for income taxes - -
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609 823
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Net loss before extraordinary item (244) (553)
Extraordinary loss on early extinguishment of debt (118) -
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Net loss $ (362) $ (553)
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Weighted average number of common
shares outstanding (thousands) 14,299 12,138
========= =========
Net loss per common share (basic and diluted)
Net loss before extraordinary item $ (0.02) $ (0.05)
Extraordinary item (0.01) -
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Net loss per common share $ (0.03) $ (0.05)
========= =========
Net cash provided by (used in) -
Operating activities $ (192) $ (226)
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Investing activities $ (57) $ (197)
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Financing activities $ 759 $ -
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SUMMARY OF BALANCE SHEETS
March 31, December 31,
2000 1999
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Current assets $ 1,154 $ 630
Property and equipment, net 6,031 6,124
Total assets 7,236 6,805
Current liabilities 227 328
Long-term debt 2,295 3,235
Total net stockholders' equity 4,714 3,242
PRODUCTION DATA
Three Months Ended
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March 31, March 31,
2000 1999
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Net production:
Oil (Bbl) 3,300 3,300
Gas (Mcf) 99,100 122,800
Average sales prices for period:
Oil ($/Bbl) $ 27.44 $ 9.99
Gas ($/Mcf) 2.70 1.80
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
None.
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SIGNATURE
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.
FORTUNE NATURAL RESOURCES CORPORATION
By: /s/ Dean W. Drulias
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Dean W. Drulias
Executive Vice President and General Counsel
Date: May 8, 2000
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