United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from...............to...............
Commission file number 0-14252
ENEX OIL & GAS INCOME PROGRAM II - 5, L.P.
(Exact name of small business issuer as specified in its charter)
Texas 76-0098592
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 200, Three Kingwood Place
Kingwood, Texas 77339
(Address of principal executive offices)
Registrant's telephone number:
(713) 358-8401
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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
Transitional Small Business Disclosure Format (Check one):
Yes No x
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
<CAPTION>
ENEX OIL & GAS INCOME PROGRAM II - 5, L.P.
BALANCE SHEET
- ----------------------------------------------------------------------------
JUNE 30,
ASSETS 1996
------------------
(Unaudited)
CURRENT ASSETS:
<S> <C>
Cash ................................................ $ 39,591
Accounts receivable - oil & gas sales ............... 25,082
Other current assets ................................ 508
----------
Total current assets .................................. 65,181
----------
OIL & GAS PROPERTIES
(Successful efforts accounting method) -
Proved mineral interests and related
equipment & facilities 4,120,403
Less accumulated depreciation and depletion ........ 4,049,938
----------
Property, net ......................................... 70,465
----------
TOTAL ................................................. $ 135,646
==========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable ................................... $ 13,378
Payable to general partner ......................... 1,932
----------
Total current liabilities ............................. 15,310
----------
PARTNERS' CAPITAL:
Limited partners ................................... 117,518
General partner .................................... 2,818
----------
Total partners' capital ............................... 120,336
----------
TOTAL ................................................. $ 135,646
==========
</TABLE>
See accompanying notes to financial statements.
- ------------------------------------------------------------------------
I-1
<TABLE>
<CAPTION>
ENEX OIL & GAS INCOME PROGRAM II - 5, L.P.
STATEMENTS OF OPERATIONS
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(UNAUDITED) QUARTER ENDED SIX MONTHS ENDED
-------------------- ---------------------
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1996 1995 1996 1995
--------- -------- --------- ---------
REVENUES:
<S> <C> <C> <C> <C>
Oil and gas sales ......... $ 12,745 $ 23,596 $ 27,215 $ 34,157
-------- -------- -------- --------
EXPENSES:
Depreciation and depletion 1,969 6,296 5,084 9,484
Lease operating expenses .. 1,993 7,013 5,762 11,884
Production taxes .......... 779 1,214 1,682 1,836
General and administrative 8,245 3,878 16,159 8,114
-------- -------- -------- --------
Total expenses .............. 12,986 18,401 28,687 31,318
-------- -------- -------- --------
INCOME (LOSS) FROM OPERATIONS (241) 5,195 (1,472) 2,839
-------- -------- -------- --------
OTHER INCOME:
Gain from sale of property 35,486 -- 35,486 --
-------- -------- -------- --------
NET INCOME .................. $ 35,245 $ 5,195 $ 34,014 $ 2,839
======== ======== ======== ========
</TABLE>
See accompanying notes to financial statements.
- -----------------------------------------------------------------------
I-2
<TABLE>
<CAPTION>
ENEX OIL AND GAS INCOME PROGRAM II - 5, L.P.
STATEMENTS OF CASH FLOWS
- -----------------------------------------------------------------------------
(UNAUDITED)
SIX MONTHS ENDED
---------------------
JUNE 30, JUNE 30,
1996 1995
---------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income ......................................... $ 34,014 $ 2,839
-------- --------
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and depletion ....................... 5,084 9,484
Gain on sale of property ......................... (35,486) --
(Increase) in:
Accounts receivable - oil & gas sales ............ (6,583) (15,081)
Other accounts receivable ........................ (18) --
Increase in:
Payable to general partner ...................... 983 2,846
-------- --------
Total adjustments .................................. (36,020) (2,751)
-------- --------
Net cash provided by operating activities .......... (2,006) 88
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property (additions) credits - development costs 60 (204)
Proceeds from sale of property ................. 35,486 --
-------- --------
Net cash provided (used) by investing activities ... 35,546 (204)
-------- --------
NET INCREASE (DECREASE) IN CASH .................... 33,540 (116)
CASH AT BEGINNING OF YEAR .......................... 6,051 687
-------- --------
CASH AT END OF PERIOD .............................. $ 39,591 $ 571
======== ========
</TABLE>
See accompanying notes to financial statements.
- ----------------------------------------------------------------------------
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<PAGE>
ENEX OIL & GAS INCOME PROGRAM II - 5, L.P.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
1. The interim financial information included herein is unaudited;
however, such information reflects all adjustments (consisting solely
of normal recurring adjustments) which are, in the opinion of
management, necessary for a fair presentation of results for the
interim periods.
2. In May, 1996, the limited partners of the Company voted to liquidate
the Company upon the sale of its remaining oil and gas properties. The
pending sale of the Hanson acquisition was not consummated due to
funding problems experienced by the potential buyer. The General
Partner of the Company has continued to search for a suitable buyer of
all of the Company's properties and anticipates final liquidation of
the Company in the near future.
3. Effective May 1, 1996, the Company sold its interests in the Newport
acquisition for $35,486. A gain of $35,486 was recognized on the sale.
I-4
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.
Second Quarter 1995 Compared to Second Quarter 1996
Oil and gas sales for the second quarter decreased to $12,745 in 1996 from
$23,596 in 1995. This represents a decrease of $10,851 (46%). Oil sales
decreased by $13,165 or 69%. A 73% decrease in oil production decreased sales by
$13,922. This decrease was partially offset by a 14% increase in the average oil
sales price. Gas sales increased by $2,314 or 52%. A 106% increase in the
average gas sales price increased sales by $3,475. This increase was partially
offset by a 26% decrease in gas production. The production decreases were
primarily the result of the sale of the Newport acquisition effective May 1,
1996.
Lease operating expenses for the second quarter decreased to $1,993 in 1996 from
$7,013 in 1995. The decrease of $5,020 (72%) is primarily due to the changes in
production, noted above.
Depreciation and depletion expense decreased to $1,969 in the second quarter of
1996 from $6,296 in the second quarter of 1995. This represents a decrease of
$4,327 (69%). A 31% decrease in the depletion rate decreased depreciation and
depletion expense by $873. The changes in production, noted above, decreased
depreciation and depletion expense by an additional $3,454. The rate decrease
was primarily a result of upward revisions of the oil and gas reserves during
December 1995.
Effective May 1, 1996, the Company sold its interests in the Newport acquisition
for $35,486. A gain of $35,486 was recognized on the sale.
General and administrative expenses for the second quarter increased to $8,245
in 1996 from $3,878 in 1995. This increase of $4,367 is primarily due to more
staff time being required to manage the Company's operations.
First Six Months in 1995 Compared to First Six Months in 1996
Oil and gas sales for the first six months decreased to $27,215 in 1996 from
$34,157 in 1995. This represents a decrease of $6,942 (20%). Oil sales decreased
by $12,857 or 51%. A 57% decrease in oil production decreased sales by $14,269.
This decrease was partially offset by a 13% increase in the average oil sales
price. Gas sales increased by $5,915 or 66%. A 75% increase in the average gas
sales price increased sales by $6,369. This increase was partially offset by a
5% decrease in gas production. The production decreases were primarily the
result of the sale of the Newport acquisition effective May 1, 1996.
Lease operating expenses decreased to $5,762 in 1996 from $11,884 in 1995. The
decrease of $6,122 (52%) is primarily due to the changes in production, noted
above.
I-5
<PAGE>
Depreciation and depletion expense decreased to $5,084 in the first six months
of 1996 from $9,484 in the first six months of 1995. This represents a decrease
of $4,400 (46%). The changes in production, noted above, reduced depreciation
and depletion expense by $3,183. A 19% decrease in the depletion rate reduced
depreciation and depletion expense by an additional $1,217. The rate decrease
was primarily a result of upward revisions of the oil and gas reserves during
December 1995.
Effective May 1, 1996, the Company sold its interests in the Newport acquisition
for $35,486. A gain of $35,486 was recognized on the sale.
General and administrative expenses in the first six months increased to $16,159
in 1996 from $8,114 in 1995. This increase of $8,045 is primarily due to more
staff time being required to manage the Company's operations.
CAPITAL RESOURCES AND LIQUIDITY
The Company's cash flow from operations is a direct result of the amount and net
proceeds realized from the sale of oil and gas production. Accordingly, the
changes in cash flow from 1995 to 1996 and primarily due to the changes in oil
and gas sales described above.
In May, 1996, the limited partners of the Company voted to liquidate the Company
upon the sale of its remaining oil and gas properties. The pending sale of the
Hanson acquisition was not consummated due to funding problems experienced by
the potential buyer. The General Partner of the Company has continued to search
for a suitable buyer of all of the Company's properties and anticipates final
liquidation of the Company in the near future.
As of June 30, 1996, the Company had no material commitments for capital
expenditures. The Company does not intend to engage in any significant
developmental drilling activity.
I-6
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Changes in Securities.
None
Item 3. Defaults Upon Senior Securities.
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders.
Not Applicable
Item 5. Other Information.
Not Applicable
Item 6. Exhibits and Reports on Form 8-K.
(a) There are no exhibits to this report.
(b) The Company filed no reports on Form 8-K during the
quarter ended June 30, 1996.
II-1
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.
ENEX OIL & GAS INCOME
PROGRAM II - 5, L.P.
(Registrant)
By:ENEX RESOURCES CORPORATION
General Partner
By: /s/ R. E. Densford
R. E. Densford
Vice President, Secretary
Treasurer and Chief Financial
Officer
August 13, 1996 By: /s/ James A. Klein
-------------------
James A. Klein
Controller and Chief
Accounting Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
(Replace this text with the legend)
</LEGEND>
<CIK> 0000769501
<NAME> Enex Oil & Gas Income Program II- 5, L.P.
<S> <C>
<PERIOD-TYPE> 6-mos
<FISCAL-YEAR-END> dec-31-1996
<PERIOD-START> jan-01-1996
<PERIOD-END> jun-30-1996
<CASH> 39591
<SECURITIES> 0
<RECEIVABLES> 25082
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 65181
<PP&E> 4120403
<DEPRECIATION> 4049938
<TOTAL-ASSETS> 135646
<CURRENT-LIABILITIES> 15310
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 120336
<TOTAL-LIABILITY-AND-EQUITY> 135646
<SALES> 27215
<TOTAL-REVENUES> 27215
<CGS> 7444
<TOTAL-COSTS> 12528
<OTHER-EXPENSES> 16159
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 34014
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
