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 March 31, 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. 33-19659-02
PARKER & PARSLEY 88-B, L.P.
(Exact name of Registrant as specified in its charter)
Delaware 75-2240121
(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 10 pages.
-There are no exhibits-
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PARKER & PARSLEY 88-B, L.P.
TABLE OF CONTENTS
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets as of March 31, 1997 and
December 31, 1996.......................................... 3
Statements of Operations for the three months
ended March 31, 1997 and 1996.............................. 4
Statement of Partners' Capital for the three months
ended March 31, 1997....................................... 5
Statements of Cash Flows for the three months
ended March 31, 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............................. 9
27. Financial Data Schedule
Signatures................................................... 10
2
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PARKER & PARSLEY 88-B, L.P.
(A Delaware Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
BALANCE SHEETS
March 31, December 31,
1997 1996
----------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including interest
bearing deposits of $163,547 at March 31 and
$106,356 at December 31 $ 164,047 $ 106,856
Accounts receivable - oil and gas sales 125,191 210,757
---------- ----------
Total current assets 289,238 317,613
---------- ----------
Oil and gas properties - at cost, based on the
successful efforts accounting method 7,108,648 7,107,384
Accumulated depletion (4,621,603) (4,576,529)
---------- ----------
Net oil and gas properties 2,487,045 2,530,855
---------- ----------
$ 2,776,283 $ 2,848,468
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 23,426 $ 22,500
Partners' capital:
Managing general partner 27,498 28,229
Limited partners (8,954 interests) 2,725,359 2,797,739
---------- ----------
2,752,857 2,825,968
---------- ----------
$ 2,776,283 $ 2,848,468
========== ==========
The financial information included as of March 31, 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 88-B, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended
March 31,
------------------------
1997 1996
---------- ----------
Revenues:
Oil and gas $ 230,006 $ 231,746
Interest 2,063 1,612
--------- ---------
232,069 233,358
--------- ---------
Costs and expenses:
Oil and gas production 101,891 100,430
General and administrative 7,099 6,952
Depletion 45,074 56,271
--------- ---------
154,064 163,653
--------- ---------
Net income $ 78,005 $ 69,705
========= =========
Allocation of net income:
Managing general partner $ 780 $ 697
========= =========
Limited partners $ 77,225 $ 69,008
========= =========
Net income per limited partnership interest $ 8.62 $ 7.71
========= =========
Distributions per limited partnership interest $ 16.71 $ 11.61
========= =========
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
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PARKER & PARSLEY 88-B, L.P.
(A Delaware Limited Partnership)
STATEMENT OF PARTNERS' CAPITAL
(Unaudited)
Managing
general Limited
partner partners Total
---------- ----------- -----------
Balance at January 1, 1997 $ 28,229 $ 2,797,739 $ 2,825,968
Distributions (1,511) (149,605) (151,116)
Net income 780 77,225 78,005
--------- ---------- ----------
Balance at March 31, 1997 $ 27,498 $ 2,725,359 $ 2,752,857
========= ========== ==========
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
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PARKER & PARSLEY 88-B, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended
March 31,
------------------------
1997 1996
---------- ----------
Cash flows from operating activities:
Net income $ 78,005 $ 69,705
Adjustments to reconcile net income to net
cash provided by operating activities:
Depletion 45,074 56,271
Changes in assets and liabilities:
(Increase) decrease in accounts receivable 85,566 (10,755)
Increase (decrease) in accounts payable 926 (19,954)
--------- ---------
Net cash provided by operating activities 209,571 95,267
--------- ---------
Cash flows from investing activities:
Additions to oil and gas properties (1,264) (1,813)
Cash flows from financing activities:
Cash distributions to partners (151,116) (105,010)
--------- ---------
Net increase (decrease) in cash and cash equivalents 57,191 (11,556)
Cash and cash equivalents at beginning of period 106,856 126,330
--------- ---------
Cash and cash equivalents at end of period $ 164,047 $ 114,774
========= =========
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
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PARKER & PARSLEY 88-B, L.P.
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
(Unaudited)
Note 1. Organization and nature of operations
Parker & Parsley 88-B, L.P. (the "Partnership") is a limited partnership
organized in 1988 under the laws of the State of Delaware.
The Partnership engages primarily in oil and gas development and production in
Texas and is not involved in any industry segment other than oil and gas.
Note 2. Basis of presentation
In the opinion of management, the unaudited financial statements as of March 31,
1997 of the Partnership 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. However, these interim results are not
necessarily indicative of results for a full year.
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
Steven L. Beal, Senior Vice President, 303 West Wall, Suite 101, Midland, Texas
79701.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations(1)
Results of Operations
Revenues:
The Partnership's oil and gas revenues decreased to $230,006 from $231,746 for
the three months ended March 31, 1997 and 1996, respectively, a decrease of
$1,740. The decrease in revenues resulted from a 16% decline in barrels of oil
produced and sold and a 20% decline in mcf of gas produced and sold, offset by
higher average prices received per barrel of oil and mcf of gas. For the three
months ended March 31, 1997, 7,933 barrels of oil were sold compared to 9,395
for the same period in 1996, a decrease of 1,462 barrels. For the three months
ended March 31, 1997, 19,397 mcf of gas were sold compared to 24,278 for the
same period in 1996, a decrease of 4,881 mcf. The volume decreases 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 increased $2.81, or 15%, from
$18.97 for the three months ended March 31, 1996 to $21.78 for the same period
7
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in 1997, while the average price received per mcf of gas increased 33% from
$2.21 during the three months ended March 31, 1996 to $2.95 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 three months ended
March 31, 1997.
Costs and Expenses:
Total costs and expenses decreased to $154,064 for the three months ended March
31, 1997 as compared to $163,653 for the same period in 1996, a decrease of
$9,589, or 6%. The decrease was due to a decrease in depletion, offset by
increases in production costs and general and administrative expenses ("G&A").
Production costs were $101,891 for the three months ended March 31, 1997 and
$100,430 for the same period in 1996, resulting in a $1,461 increase. The
increase was primarily due to an increase in well repair and maintenance costs,
offset by a decline in ad valorem taxes.
G&A's components are independent accounting and engineering fees and managing
general partner personnel and operating costs. During this period, G&A increased
slightly from $6,952 for the three months ended March 31, 1996 to $7,099 for the
same period in 1997.
Depletion was $45,074 for the three months ended March 31, 1997 compared to
$56,271 for the same period in 1996. This represented a decrease in depletion of
$11,197, or 20%. This decrease was the result of an upward revision in oil and
gas reserves and a decline in oil production of 1,462 barrels for the three
months ended March 31, 1997 compared to the same period in 1996.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities increased $114,304 during the three
months ended March 31, 1997 from the same period in 1996. This increase was due
to an increase in oil and gas sales receipts and a decline in production costs
paid.
Net Cash Used in Investing Activities
The Partnership's principal investing activities during the three months ended
March 31, 1997 and 1996 were for equipment replacement on various oil and gas
properties.
Net Cash Used in Financing Activities
Cash was sufficient for the three months ended March 31, 1997 to cover
distributions to the partners of $151,116 of which $149,605 was distributed to
the limited partners an $1,511 to the managing general partner. For the same
8
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period ended March 31, 1996, cash was sufficient for distributions to the
partners of $105,010 of which $103,960 was distributed to the limited partners
and $1,050 to the managing general partner.
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
9
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PARKER & PARSLEY 88-B, L.P.
(A Delaware 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 88-B, L.P.
By: Parker & Parsley Development L.P.,
Managing General Partner
By: Parker & Parsley Petroleum USA, Inc.
("PPUSA"), General Partner
Dated: May 9, 1997 By: /s/ Steven L. Beal
---------------------------------------
Steven L. Beal, Senior Vice President
and Chief Financial Officer of PPUSA
10
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0
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