UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
/ x / Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended September 30, 1997
or
/ / Transition Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the transition period from _______ to _______
Commission File No. 2-81398A
PARKER & PARSLEY 83-A, LTD.
(Exact name of Registrant as specified in its charter)
Texas 75-1891384
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
303 West Wall, Suite 101, Midland, Texas 79701
(Address of principal executive offices) (Zip code)
Registrant's Telephone Number, including area code : (915) 683-4768
Not applicable
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes / x / No / /
Page 1 of 11 pages.
Exhibit index on page 10.
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PARKER & PARSLEY 83-A, LTD.
TABLE OF CONTENTS
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets as of September 30, 1997 and
December 31, 1996 ......................................... 3
Statements of Operations for the three and nine
months ended September 30, 1997 and 1996...................... 4
Statement of Partners' Capital for the nine months
ended September 30, 1997...................................... 5
Statements of Cash Flows for the nine months ended
September 30, 1997 and 1996................................... 6
Notes to Financial Statements................................... 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations........................... 7
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K................................ 10
27. Financial Data Schedule
Signatures...................................................... 11
2
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PARKER & PARSLEY 83-A, LTD.
(A Texas Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
BALANCE SHEETS
September 30, December 31,
1997 1996
------------- -------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including interest
bearing deposits of $172,133 at September 30
and $171,164 at December 31 $ 172,633 $ 171,664
Accounts receivable - oil and gas sales 180,254 271,000
----------- -----------
Total current assets 352,887 442,664
----------- -----------
Oil and gas properties - at cost, based on the
successful efforts accounting method 17,830,231 17,822,921
Accumulated depletion (14,050,689) (13,806,313)
----------- -----------
Net oil and gas properties 3,779,542 4,016,608
----------- -----------
$ 4,132,429 $ 4,459,272
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 54,648 $ 38,807
Partners' capital:
General partners 448,184 492,167
Limited partners (19,505 interests) 3,629,597 3,928,298
----------- -----------
4,077,781 4,420,465
----------- -----------
$ 4,132,429 $ 4,459,272
=========== ===========
The financial information included as of September 30, 1997 has been prepared
by management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
3
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PARKER & PARSLEY 83-A, LTD.
(A Texas Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
---------------------- ----------------------
1997 1996 1997 1996
---------- ---------- ---------- ----------
Revenues:
Oil and gas $ 334,375 $ 440,353 $1,063,146 $1,260,313
Interest 2,794 4,960 8,473 13,660
Litigation settlement - - - 852,211
Gain on disposition of assets - - - 924
--------- -------- --------- ---------
337,169 445,313 1,071,619 2,127,108
--------- -------- --------- ---------
Costs and expenses:
Oil and gas production 198,636 184,232 638,468 544,997
General and administrative 11,950 14,439 37,103 41,534
Depletion 81,381 73,611 244,376 241,409
--------- -------- --------- ---------
291,967 272,282 919,947 827,940
--------- -------- --------- ---------
Net income $ 45,202 $ 173,031 $ 151,672 $1,299,168
========= ========= ========= =========
Allocation of net income:
General partners $ 23,988 $ 54,607 $ 75,877 $ 331,430
========= ========= ========= =========
Limited partners $ 21,214 $ 118,424 $ 75,795 $ 967,738
========= ========= ========= =========
Net income per limited
partnership interest $ 1.09 $ 6.07 $ 3.89 $ 49.61
========= ========= ========= =========
Distributions per limited
partnership interest $ 5.00 $ 8.60 $ 19.20 $ 57.63
========= ========= ========= =========
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
PARKER & PARSLEY 83-A, LTD.
(A Texas Limited Partnership)
STATEMENT OF PARTNERS' CAPITAL
(Unaudited)
General Limited
partners partners Total
----------- ------------ -------------
Balance at January 1, 1997 $ 492,167 $ 3,928,298 $ 4,420,465
Distributions (119,860) (374,496) (494,356)
Net income 75,877 75,795 151,672
--------- ---------- -----------
Balance at September 30, 1997 $ 448,184 $ 3,629,597 $ 4,077,781
========= ========== ===========
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
PARKER & PARSLEY 83-A, LTD.
(A Texas Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Nine months ended
September 30,
------------------------
1997 1996
---------- ------------
Cash flows from operating activities:
Net income $ 151,672 $ 1,299,168
Adjustments to reconcile net income to net
cash provided by operating activities:
Depletion 244,376 241,409
Gain on disposition of assets - (924)
Changes in assets and liabilities:
(Increase) decrease in accounts receivable 90,746 (44,585)
Increase (decrease) in accounts payable 15,841 (44,760)
-------- ----------
Net cash provided by operating activities 502,635 1,450,308
-------- ----------
Cash flows from investing activities:
Additions to oil and gas properties (7,310) (604)
Proceeds from disposition of assets - 924
-------- -----------
Net cash provided by (used in)
investing activities (7,310) 320
-------- ----------
Cash flows from financing activities:
Cash distributions to partners (494,356) (1,463,369)
-------- ----------
Net increase (decrease) in cash and cash equivalents 969 (12,741)
Cash and cash equivalents at beginning of period 171,664 377,780
-------- ----------
Cash and cash equivalents at end of period $ 172,633 $ 365,039
======== ==========
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
PARKER & PARSLEY 83-A, LTD.
(A Texas Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
September 30, 1997
(Unaudited)
Note 1. Basis of presentation
In the opinion of management, the unaudited financial statements of Parker &
Parsley 83-A, Ltd. (the "Partnership") as of September 30, 1997 and for the
three and nine months ended September 30, 1997 and 1996 include all adjustments
and accruals consisting only of normal recurring accrual adjustments which are
necessary for a fair presentation of the results for the interim period. These
interim results are not necessarily indicative of results for a full year.
Certain information and footnote disclosure normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted in this Form 10-Q pursuant to the rules and
regulations of the Securities and Exchange Commission. The financial statements
should be read in conjunction with the financial statements and the notes
thereto contained in the Partnership's Report on Form 10-K for the year ended
December 31, 1996, as filed with the Securities and Exchange Commission, a copy
of which is available upon request by writing to Rich Dealy, Vice President and
Controller, 303 West Wall, Suite 101, Midland, Texas 79701.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations (1)
As of August 8, 1997, Pioneer Natural Resources USA, Inc. ("Pioneer USA") became
the managing general partner of the Partnership, joining the existing general
partner, P&P Employees 83-A, Ltd. ("EMPL"), a Texas limited partnership whose
general partner is Pioneer USA, and 1,352 limited partners as of March 8, 1997.
Prior to August 8, 1997, the Partnership's managing general partner and the
general partner of EMPL was Parker & Parsley Development L.P. ("PPDLP"), a
wholly-owned subsidiary of Parker & Parsley Petroleum Company ("Parker &
Parsley"). On August 7, 1997, Parker & Parsley and Mesa Inc. received
shareholder approval to merge and create Pioneer Natural Resources Company
("Pioneer"). On August 8, 1997, PPDLP was merged with and into Pioneer USA, a
wholly-owned subsidiary of Pioneer, resulting in Pioneer USA becoming the
managing general partner of the Partnership and the general partner of EMPL as
PPDLP's successor by merger. For a more complete description of the Parker &
Parsley and Mesa Inc. merger, see Pioneer's Registration Statement on Form S-4
as filed with the Securities and Exchange Commission.
Results of Operations
Nine months ended September 30, 1997 compared with nine months ended
September 30, 1996
Revenues:
The Partnership's oil and gas revenues decreased 16% to $1,063,146 from
$1,260,313 for the nine months ended September 30, 1997 as compared to the nine
7
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months ended September 30, 1996. The decrease in revenues resulted from declines
in barrels of oil and mcf of gas produced and sold and a lower average price
received per barrel of oil. For the nine months ended September 30, 1997, 38,890
barrels of oil were sold compared to 43,607 for the same period in 1996, a
decrease of 4,717 barrels, or 11%. For the nine months ended September 30, 1997,
128,006 mcf of gas were sold compared to 150,571 for the same period in 1996, a
decrease of 22,565 mcf, or 15%. The decreases in production volumes were
primarily due to the decline characteristics of the Partnership's oil and gas
properties. Because of these characteristics, management expects a certain
amount of decline in production to continue in the future until the
Partnership's economically recoverable reserves are fully depleted.
The average price received per barrel of oil decreased $1.26, or 6%, from $20.87
for the nine months ended September 30, 1996 to $19.61 for the same period in
1997, while the average price received per mcf of gas increased slightly from
$2.33 for the nine months ended September 30, 1996 to $2.35 for the same period
in 1997. The market price for oil and gas has been extremely volatile in the
past decade, and management expects a certain amount of volatility to continue
in the foreseeable future. The Partnership may therefore sell its future oil and
gas production at average prices lower or higher than that received during the
nine months ended September 30, 1997.
On April 29, 1996, Southmark Corporation, the managing general partner and the
Partnership entered into a final $7.4 million settlement agreement with Jack N.
Price resolving all outstanding litigation between the parties. As a result, all
of the pending lawsuits and judgments have been dismissed, the supersedeas bond
released, and the Reserve released as collateral. On June 28, 1996, a final
distribution was made to the working interest owners of $852,211, which included
$669,535, or $34.33 per limited partnership interest, to the Partnership and its
partners.
The gain on disposition of assets of $924 resulted from salvage income received
during the nine months ended September 30, 1996, from equipment credits received
on two fully depleted wells.
Costs and Expenses:
Total costs and expenses increased to $919,947 for the nine months ended
September 30, 1997 as compared to $827,940 for the same period in 1996, an
increase of $92,007, or 11%. This increase was due to increases in production
costs and depletion, offset by a decline in general and administrative expenses
("G&A").
Production costs were $638,468 for the nine months ended September 30, 1997 and
$544,997 for the same period in 1996 resulting in a $93,471 increase, or 17%.
The increase was attributable to higher well repair and maintenance costs, and
workover expense incurred in an effort to stimulate well production.
G&A's components are independent accounting and engineering fees and managing
general partner personnel and operating costs. During this period, G&A
decreased, in aggregate, 11% from $41,534 for the nine months ended September
30, 1996 to $37,103 for the same period in 1997.
Depletion was $244,376 for the nine months ended September 30, 1997 compared to
$241,409 for the same period in 1996, representing an increase of $2,967. The
increase was attributable to a decline in oil reserves during 1997 as a result
of lower commodity prices.
8
<PAGE>
Three months ended September 30, 1997 compared with three months ended
September 30, 1996
Revenues:
The Partnership's oil and gas revenues decreased 24% to $334,375 from $440,353
for the three months ended September 30, 1997 as compared to the three months
ended September 30, 1996. The decrease in revenues resulted from declines in the
average prices received per barrel of oil and mcf of gas and declines in barrels
of oil and mcf of gas produced and sold. For the three months ended September
30, 1997, 13,139 barrels of oil were sold compared to 14,846 for the same period
in 1996, a decrease of 1,707 barrels, or 11%. For the three months ended
September 30, 1997, 44,065 mcf of gas were sold compared to 51,948 for the same
period in 1996, a decrease of 7,883 mcf, or 15%. The decreases in production
volumes were due to the decline characteristics of the Partnership's oil and gas
properties.
The average price received per barrel of oil decreased $3.42, or 16%, from
$21.72 for the three months ended September 30, 1996 to $18.30 for the three
months ended September 30, 1997 while the average price received per mcf of gas
decreased 6% from $2.27 for the three months ended September 30, 1996 to $2.13
for the same period in 1997.
Costs and Expenses:
Total costs and expenses increased to $291,967 for the three months ended
September 30, 1997 as compared to $272,282 for the same period in 1996, an
increase of $19,685, or 7%. This increase was due to increases in production
costs and depletion, offset by a decline in G&A.
Production costs were $198,636 for the three months ended September 30, 1997 and
$184,232 for the same period in 1996 resulting in a $14,404 increase, or 8%. The
increase was due to higher well repair and maintenance costs incurred in an
effort to stimulate production.
G&A's components are independent accounting and engineering fees and managing
general partner personnel and operating costs. During this period, G&A
decreased, in aggregate, 17% from $14,439 for the three months ended September
30, 1996 to $11,950 for the same period in 1997.
Depletion was $81,381 for the three months ended September 30, 1997 compared to
$73,611 for the same period in 1996, representing an increase of $7,770, or 11%,
primarily attributable to a decline in oil reserves during 1997 as a result of
lower commodity prices.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities decreased $947,673 during the nine
months ended September 30, 1997 compared to the same period in 1996. This
decrease was due to the receipt of proceeds from the litigation settlement
received in 1996 as discussed in Item 2, in addition to a decrease in oil and
gas sales receipts, and an increase in production and G&A costs paid.
9
<PAGE>
Net Cash Provided by (Used in) Investing Activities
The Partnership's investment activities during the nine months ended September
30, 1997 and 1996 included expenditures related to equipment replacement on
various oil and gas properties.
During the nine months ended September 30, 1996, proceeds of $924 were received
from the disposal of oil and gas equipment on two fully depleted properties.
Net Cash Used in Financing Activities
Cash was sufficient for the nine months ended September 30, 1997 to cover
distributions to the partners of $494,356 of which $119,860 was distributed to
the general partners and $374,496 to the limited partners. For the same period
ended September 30, 1996, cash was sufficient for distributions to the partners
of $1,463,369 of which $339,266 was distributed to the general partners and
$1,124,103 to the limited partners. Cash distributions to the partners of
$1,463,369 for the nine months ended September 30, 1996 included $182,676 to the
general partners and $669,535 to the limited partners, resulting from proceeds
received in the litigation settlement during 1996 as discussed in Item 2.
It is expected that future net cash provided by operating activities will be
sufficient for any capital expenditures and any distributions. As the production
from the properties declines, distributions are also expected to decrease.
- ---------------
(1) "Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations" contains forward looking statements that involve
risks and uncertainties. Accordingly, no assurances can be given that
the actual events and results will not be materially different than the
anticipated results described in the forward looking statements.
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27. Financial Data Schedule
(b) Reports on Form 8-K - none
10
<PAGE>
PARKER & PARSLEY 83-A, LTD.
(A Texas Limited Partnership)
S I G N A T U R E S
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.
PARKER & PARSLEY 83-A, LTD.
By: Pioneer Natural Resources USA, Inc.,
Managing General Partner
Dated: November 10, 1997 By: /s/ Rich Dealy
------------------------------------
Rich Dealy, Vice President and
Controller
11
<PAGE>
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<ARTICLE> 5
<CIK> 0000743456
<NAME> 83A.83A.TXT
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 172,633
<SECURITIES> 0
<RECEIVABLES> 180,254
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 352,887
<PP&E> 17,830,231
<DEPRECIATION> 14,050,689
<TOTAL-ASSETS> 4,132,429
<CURRENT-LIABILITIES> 54,648
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 4,077,781
<TOTAL-LIABILITY-AND-EQUITY> 4,132,429
<SALES> 1,063,146
<TOTAL-REVENUES> 1,071,619
<CGS> 0
<TOTAL-COSTS> 919,947
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 151,672
<INCOME-TAX> 0
<INCOME-CONTINUING> 151,672
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 151,672
<EPS-PRIMARY> 3.89
<EPS-DILUTED> 0
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