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 June 30, 1994
------------------
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 number 1-10053
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ORYX ENERGY COMPANY
--------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 23-1743284
---------- -------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
13155 NOEL ROAD, DALLAS, TEXAS 75240-5067
- - ----------------------------------------------------------
(Address of principal executive offices) (Zip code)
(214) 715-4000
--------------
(Registrant's telephone number, including area code)
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
The number of shares of common stock, $1 par value,
outstanding on July 31, 1994 was 96,946,069.<PAGE>
<PAGE>
ORYX ENERGY COMPANY
INDEX
Page
----
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statements of Income for the
Three and Six Months Ended June 30, 1994 and 1993 3
Condensed Consolidated Balance Sheets at June 30,
1994 and December 31, 1993 4
Condensed Consolidated Statements of Cash Flows for
the Six Months Ended June 30, 1994 and 1993 5
Notes to Condensed Consolidated Financial Statements 6
Report of Independent Accountants 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURE 13
<PAGE>
<PAGE>
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
ORYX ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
For the Three Months For the Six Months
(Millions of Dollars, Ended June 30 Ended June 30
Except Per Share Amounts) 1994 1993 1994 1993
---- ---- ---- ----
(Unaudited)
REVENUES
Oil and gas $ 259 $ 280 $ 521 $ 563
Other (4) (2) (6) (2)
------- ------- ------- -------
255 278 515 561
------- ------- ------- -------
COSTS AND EXPENSES
Operating costs 93 84 185 181
Production taxes 20 31 45 61
Exploration costs 29 16 57 32
Depreciation, depletion
and amortization 103 90 213 191
General and administrative
expense 18 20 37 43
Interest and debt expense 41 41 80 81
Interest capitalized (4) (11) (7) (24)
Provision for restructuring
(Note 2) - - 161 -
------- ------- ------- -------
300 271 771 565
------- ------- ------- -------
Income (Loss) Before
Provision for Income
Taxes (45) 7 (256) (4)
Provision (Benefit) for
Income Taxes (Note 3) (13) 4 (84) 2
Remeasurement of Foreign
Deferred Tax (Note 3) 9 (1) 9 (3)
------- ------- ------- -------
Net Income (Loss) (41) 4 (181) (3)
Less Preferred Dividend 1 1 1 2
------- ------- ------- -------
Net Income (Loss)
Attributable to
Common Stock $ (42) $ 3 $ (182) $ (5)
======= ======= ======= =======
Net Income (Loss) Per
Share of Common Stock $ (.43) $ .03 $(1.88) $ (.06)
======= ======= ======= =======
<PAGE>
Cash Dividends Per Share
of Common Stock $ - $ .10 $ - $ .20
======= ======= ======= =======
Weighted Average Number
of Common Shares
Outstanding (millions
of shares) 97.0 97.1 97.0 97.1
======= ======= ======= =======
(See Accompanying Notes)<PAGE>
<PAGE>
ORYX ENERGY COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30 December 31
(Millions of Dollars) 1994 1993
-------- -----------
(Unaudited)
ASSETS
Current Assets
Cash and cash equivalents $ 7 $ 10
Accounts and notes receivable and
other current assets 249 195
-------- --------
Total Current Assets 256 205
Properties, Plants and Equipment (Note 4) 3,132 3,333
Deferred Charges and Other Assets 80 86
-------- --------
Total Assets $ 3,468 $ 3,624
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable $ 129 $ 134
Accrued liabilities 215 162
Current portion of long-term debt 23 28
-------- --------
Total Current Liabilities 367 324
Long-Term Debt 1,825 1,741
Deferred Income Taxes 604 682
Deferred Credits and Other Liabilities 176 201
Shareholders' Equity (Note 5)
Preference stock, par value $1 per share,
cumulative 7 7
Common stock, par value $1 per share 124 124
Additional paid-in capital 2,204 2,204
Retained earnings (deficit) (337) (155)
-------- --------
1,998 2,180
Less: Common stock in treasury, at cost (1,401) (1,402)
Loan to ESOP (101) (102)
-------- --------
Shareholders' Equity 496 676
-------- --------
Total Liabilities and Shareholders' Equity $ 3,468 $ 3,624
======== ========
The successful efforts method of accounting is followed.
(See Accompanying Notes)
<PAGE>
<PAGE>
ORYX ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Six Months
Ended June 30
(Millions of Dollars) 1994 1993
------ ------
(Unaudited)
CASH FROM OPERATING ACTIVITIES
Net loss $ (181) $ (3)
Adjustments to reconcile net loss to net
cash from operating activities:
Depreciation, depletion and amortization 213 191
Dry hole costs and leasehold impairment 31 7
Loss on sale of assets, net of taxes 2 1
Deferred income taxes (29) (1)
Remeasurement of foreign deferred tax 9 -
Provision for restructuring, net of taxes 103 -
Proceeds from interest rate hedging
activities - 28
Other (2) 3
------- -------
146 226
Changes in working capital:
Accounts and notes receivable and
other current assets (52) 2
Accounts payable and accrued
liabilities (14) (52)
------- -------
Net Cash Flow Provided From Operating
Activities 80 176
------- -------
INVESTING ACTIVITIES
Capital expenditures (130) (179)
Proceeds from divestments, net of current
taxes 3 18
Other (34) (7)
------- -------
Net Cash Flow Used For Investing Activities (161) (168)
------- -------
FINANCING ACTIVITIES
Proceeds from borrowings 120 66
Repayments of long-term debt (41) (53)
Cash dividends paid on common and
preference stock (1) (23)
------- -------
Net Cash Flow Provided From (Used For)
Financing Activities 78 (10)
------- -------
CHANGES IN CASH AND CASH EQUIVALENTS (3) (2)
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD 10 10
------- -------
<PAGE>
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 7 $ 8
======= =======
(See Accompanying Notes)
<PAGE>
<PAGE>
ORYX ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying condensed consolidated financial statements
and related notes of Oryx Energy Company and its subsidiaries
(hereinafter, unless the context otherwise requires, being
referred to as the Company) are presented in accordance with the
requirements of Form 10-Q and do not include all disclosures
normally required by generally accepted accounting principles or
those normally made in annual reports on Form 10-K. In
management's opinion, all adjustments necessary for a fair
presentation of the results of operations for the periods shown
have been made and are of a normal recurring nature. The results
of operations of the Company for the six months ended June 30,
1994 are not necessarily indicative of the results for the full
year 1994.
Statements of Cash Flows
Amounts paid for interest and income taxes were as follows:
Six Months Ended June 30
1994 1993
------ ------
(Millions of Dollars)
Interest paid (net of capitalized
amounts) $ 63 $ 53
Income taxes paid $ 2 $ 15
In accordance with Statement of Financial Accounting
Standards No. 95, "Statement of Cash Flows," non-cash
transactions are not reflected within the accompanying Condensed
Consolidated Statements of Cash Flows.
2. Provision for Restructuring
In March 1994, the Company adopted plans designed to achieve
significant future cost reductions (Restructuring). Components
of the Restructuring include asset disposals and staff
reductions. Associated therewith, the Company recognized a $161
million pretax ($103 million after tax) charge in the first
quarter of 1994. Management expects the Restructuring to result
in a minimum of $61 million annual cost reductions in 1995.
During 1993, the properties included in the divestment plan
accounted for less than three percent of the Company's worldwide
oil and gas production and at December 31, 1993, they accounted
for less than four percent of the Company's net investment in
properties, plants and equipment. The Company expects to
complete the asset disposals during 1994. The personnel
reductions affected about 20-percent of the Company's workforce.<PAGE>
<PAGE>
ORYX ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(continued)
3. Income Taxes
The Company's provisions for income taxes for the three and
six months ended June 30, 1994 reflect benefits of $13 million
and $84 million. Foreign income tax provisions included within
the Company's consolidated provisions are determined based upon
the appropriate foreign statutory rates which differ from the
U.S. statutory rate.
The remeasurement provisions of Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS
No. 109) require the Company to remeasure its foreign currency
denominated deferred tax liabilities at current exchange rates.
The reported earnings of the Company for the three and six months
ended June 30, 1994 decreased $9 million while reported earnings
for the three and six months ended June 30, 1993 increased $1
million and $3 million from such remeasurement. Management
believes that such non-cash remeasurement credits and debits
distort current period economic results and should be disregarded
in analyzing the Company's current business. Future economic
results may also be distorted because payment of the deferred tax
liability is not expected to occur in the near-term and it is
likely that exchange rates will fluctuate prior to the eventual
settlement of the liability.
4. Properties, Plants and Equipment
At June 30, 1994 and December 31, 1993, the Company's
properties, plants and equipment; and related accumulated
depreciation, depletion and amortization were as follows:
June 30 December 31
1994 1993
------- -----------
(Millions of Dollars)
Gross investment ................. $ 6,500 $ 6,523
Less accumulated depreciation,
depletion and amortization ..... 3,368 3,190
-------- --------
Net investment ................... $ 3,132 $ 3,333
======== ========
5. Shareholders' Equity
Shares of the Company's preferred and common stocks
authorized, issued, outstanding and in treasury at June 30, 1994
and December 31, 1993 were as follows:
<PAGE>
In
Authorized Issued Outstanding Treasury
(Thousands of Shares)
June 30, 1994
Preferred stock 15,000 - - -
Preference stock 15,000 7,259 7,259 -
Common stock 250,000 126,704 96,946 (26,756)
December 31, 1993
Preferred stock 15,000 - - -
Preference stock 15,000 7,259 7,259 -
Common stock 250,000 126,704 96,932 (26,769)
<PAGE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors, Oryx Energy Company:
We have made a review of the condensed consolidated balance sheet
of Oryx Energy Company and its Subsidiaries as of June 30, 1994,
the related condensed consolidated statements of income for the
three and six months ended June 30, 1994 and 1993, and the
related condensed consolidated statements of cash flows for the
six months ended June 30, 1994 and 1993, in accordance with
standards established by the American Institute of Certified
Public Accountants.
A review of interim financial information consists principally of
obtaining an understanding of the system for the preparation of
interim financial information, applying analytical review
procedures to financial data, and making inquiries of persons
responsible for financial and accounting matters. It is
substantially less in scope than an audit in accordance with
generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements
taken as a whole. Accordingly, we do not express such an
opinion.
Based on our review, we are not aware of any material
modifications that should be made to the condensed consolidated
financial statements referred to above for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the consolidated balance sheet as of December
31, 1993, and the related consolidated statements of income and
cash flows for the year then ended (not presented herein); and in
our report dated February 19, 1994, we expressed an unqualified
opinion on those consolidated financial statements. In our
opinion, the information set forth in the accompanying condensed
consolidated balance sheet as of December 31, 1993 is fairly
stated in all material respects in relation to the consolidated
balance sheet from which it has been derived.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
August 9, 1994
<PAGE>
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
FINANCIAL CONDITION
The Company's cash and cash equivalents decreased by $3 million
over the six months ended June 30, 1994. The decrease was
comprised of $80 million of net cash flow provided from operating
activities, $161 million of net cash flow used for investing
activities and $78 million of net cash flow provided from
financing activities. The $80 million in net cash flow provided
from operating activities consisted of $146 million in net cash
flow provided from operating activities before changes in current
assets and liabilities and $66 million used for changes in
current assets and liabilities. The $146 million in net cash
flow provided from operating activities before changes in current
assets and liabilities was primarily impacted by lower crude oil
prices, higher natural gas prices, continued reductions in costs
and expenses and reduced production volumes due to asset sales
and normal declines. The $66 million of net cash flow used for
changes in current assets and liabilities consisted of a $52
million increase in accounts receivable and other current assets
and a $14 million decrease in accounts payable and accrued
liabilities.
The $161 million in net cash flow used for investing activities
and the $78 million in net cash flow provided from financing
activities are primarily due to a cash use of $130 million for
capital expenditures and a cash source of $79 million from net
increases in debt.
In March 1994, the Company announced a major cost reduction
program. The program involves consolidation of the Company's
U.S. onshore position. The Company will also outsource certain
non-critical technical functions and reduce administrative
functions accordingly. The net result of these actions will be a
loss of approximately 300 jobs. The Company expects to achieve a
minimum $61 million cost reduction for the full year of 1995 as a
result of these actions. Some expense reductions will occur in
1994, although the specific amount and timing are difficult to
predict.
In the first quarter of 1994, the Company recorded a net charge
of $103 million for estimated losses on the sale of assets ($71
million), employee terminations and associated costs ($17
million) and postretirement benefit adjustments ($15 million).
During 1995, estimated production will be reduced by
approximately five thousand equivalent barrels per day,
representing only about two percent of the worldwide production
for the first six months of 1994.
<PAGE>
The Company paid a cash dividend of $.10 per share on its common
stock in each of the first and second quarters of 1993. In 1994,
the Board of Directors suspended the payment of dividends on
common stock.
RESULTS OF OPERATIONS - SIX MONTHS
The Company's net loss for the six months ended June 30, 1994 was
$181 million, or $1.88 per share, as compared to a net loss, of
$3 million, or $.06 per share for the first six months of 1993.
Revenues for the six months were $515 million in 1994 versus $561
million in 1993. Year-to-date results include a $103 million
restructuring charge, a $9 million charge relating to Statement
of Financial Accounting Standards No. 109, "Accounting for Income
Taxes" (SFAS No. 109) and $2 million of net losses related to
asset sales. By comparison, results for the six months ended
June 30, 1993 include a $3 million benefit for SFAS No. 109 and
$1 million of net losses relating to asset sales.
Worldwide production of crude oil and condensate for the six
months ended June 30, 1994 was 116 thousand barrels daily
compared to production for the six months ended June 30, 1993 of
107 thousand barrels daily. Production of crude oil and
condensate was 50 thousand barrels daily in the United States and
66 thousand barrels daily from foreign locations during the six
months ended June 30, 1994, compared to 56 thousand barrels daily
in the United States and 51 thousand barrels daily from foreign
locations during the six months ended June 30, 1993. The
worldwide crude oil and condensate price for the first six
months of 1994 was $14.26 per barrel compared to $17.74 per
barrel for the first six months of 1993.
Worldwide production of natural gas was 605 million cubic feet
daily for the six months ended June 30, 1994, compared to 620
million cubic feet in the six months ended June 30, 1993.
Production of natural gas was 537 million cubic feet daily in the
United States and 68 million cubic feet daily from the United
Kingdom in the first six months of 1994, compared to 524 million
cubic feet daily in the United States and 96 million cubic feet
daily in the United Kingdom in the first six months of 1993. The
worldwide price of natural gas for the first six months of 1994
and 1993 was $2.03 and $1.95 per thousand cubic feet.
RESULTS OF OPERATIONS - THREE MONTHS
The Company's net loss for the quarter ended June 30, 1994 was
$41 million, or $.43 per share, as compared to net income of $4
million, or $.03 per share, for the quarter ended June 30, 1993.
Revenues for the 1994 second quarter were $255 million versus
$278 million for the second quarter of 1993.
<PAGE>
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations - continued
RESULTS OF OPERATIONS - THREE MONTHS (continued)
The second quarter of 1994 includes a net operating loss of $31
million, a $9 million charge relating to SFAS No. 109 and $1
million of net losses related to asset sales. By comparison, the
second quarter of 1993 includes net operating income of $3
million and a $1 million benefit relating to SFAS No. 109.
Compared to the same quarter last year, crude oil volumes
increased by 9 percent or 10 thousand barrels per day, as a
result of strong U.K. production, while natural gas volumes
decreased 11 mmcf per day because of lower U.S. production.
Worldwide crude oil prices fell $2.78 per barrel and natural gas
prices decreased $.12 per mcf. Total costs and expenses
increased because of larger non-cash charges.
Comparing the 1994 second quarter with the previous quarter,
worldwide oil volumes were the same while gas volumes were lower
primarily as a result of lower seasonal demand in the U.K.
Worldwide oil prices rose $1.63 per barrel while gas prices
decreased by $.15 per mcf. Spot WTI oil prices did not attain
current levels, which are in excess of $19 per barrel, until
mid-June. Excluding the restructuring provision in the first
quarter, total costs and expenses decreased by $10 million
primarily because of lower production taxes and depreciation,
depletion, and amortization.
Worldwide production of crude oil and condensate for the three
months ended June 30, 1994 was 116 thousand barrels daily
compared to production for the three months ended June 30, 1993
of 106 thousand barrels daily. Production of crude oil and
condensate was 49 thousand barrels daily in the United States and
67 thousand barrels daily from foreign locations during the three
months ended June 30, 1994, compared to 56 thousand barrels daily
in the United States and 50 thousand barrels daily from foreign
locations in the second quarter of 1993. The worldwide crude oil
and condensate price in the second quarter of 1994 was $15.07 per
barrel compared to $17.85 per barrel in the second quarter of
1993.
Worldwide production of natural gas was 565 million cubic feet
daily for the three months ended June 30, 1994, compared to 576
million cubic feet daily in the three months ended June 30, 1993.
<PAGE>
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations - continued
RESULTS OF OPERATIONS - THREE MONTHS (continued)
Production of natural gas was 520 million cubic feet daily in the
United States and 45 million cubic feet daily from the United
Kingdom in the second quarter of 1994, compared to 533 million
cubic feet daily in the United States and 43 million cubic feet
daily from the United Kingdom in the second quarter of 1993. The
worldwide price of natural gas for the second quarter of 1994 was
$1.95 per thousand cubic feet compared to $2.07 per thousand
cubic feet in the second quarter of 1993.
<PAGE>
<PAGE>
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
12 Computation of Consolidated Ratio of Earnings to
Fixed Charges.
*15 Accountant's letter regarding unaudited interim
financial information.
28 Awareness letter of Coopers & Lybrand L.L.P.
* Attached as page 8 to this Form 10-Q.
(b) Reports on Form 8-K:
The Company did not file any reports on Form 8-K during
the quarter ended June 30, 1994.
<PAGE>
<PAGE>
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.
ORYX ENERGY COMPANY
BY /s/ E. W. Moneypenny
--------------------
E. W. Moneypenny
(Senior Vice President, Finance, and Chief Financial
Officer)
DATE August 9, 1994
EXHIBIT 12
ORYX ENERGY COMPANY
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS
TO FIXED CHARGES - UNAUDITED (a)
(Millions of Dollars)
Three Months Six Months
Ended June 30 Ended June 30
1994 1994
------------- -------------
RATIO OF EARNINGS TO FIXED CHARGES:
Fixed Charges:
Consolidated interest cost and
debt expense $ 41 $ 80
Interest allocable to rental
expense (b) 3 6
------ ------
Total $ 44 $ 86
====== ======
Earnings:
Consolidated income (loss) before
benefit for income taxes $ (45) $(256)
Fixed charges 44 86
Interest capitalized (4) (7)
Amortization of previously
capitalized interest 3 6
------ ------
Total $ (2) $(171)
====== ======
Ratio of Earnings to Fixed Charges (c) ====== ======
RATIO OF EARNINGS TO FIXED CHARGES AND
PREFERRED STOCK DIVIDEND REQUIREMENTS:
Fixed Charges:
Consolidated interest cost and debt
expense $ 41 $ 80
Preferred stock dividend requirements 1 1
Interest allocable to rental
expense (b) 3 6
------ ------
Total $ 45 $ 87
====== ======
Earnings:
Consolidated income (loss) before
benefit for income taxes $ (45) $(256)
Fixed charges 45 87
Interest capitalized (4) (7)
Amortization of previously
capitalized interest 3 6
------ ------
Total $ (1) $(170)
====== ======
Ratio of Earnings to Fixed Charges (c) ====== ======
(a) The consolidated financial statements of Oryx Energy Company
include the accounts of all subsidiaries (more than 50 percent
owned and/or controlled).
(b) Represents one-third of total operating lease rental expense
which is that portion deemed to be interest.
(c) Since earnings for the three and six months ended June 30
were less than zero, the ratio of earnings to fixed charges and
earnings to fixed charges and preferred stock dividend
requirements are not meaningful and accordingly, have not been
presented. Earnings for the three and six months ended June 30
were inadequate to cover fixed charges and preferred stock
dividend requirements by $46 million and $257 million.
EXHIBIT 28
Securities and Exchange Commission
450 Fifth Street, Northwest
Washington, D.C. 20549
Attn: Document Control
Re: Oryx Energy Company Form 10-Q
We are aware that our report dated August 9, 1994 on our review
of the interim condensed consolidated balance sheet of Oryx
Energy Company and its Subsidiaries as of June 30, 1994, the
related condensed consolidated statements of income for the three
and six months ended June 30, 1994 and 1993, and the related
condensed consolidated statements of cash flows for the six
months ended June 30, 1994 and 1993, included in this Form 10-Q,
is incorporated by reference in the following registration
statements:
Registration No.
----------------
On Form S-3 for:
Oryx Energy Company $500,000,000 Debt
Securities; Preferred Stock; and
Common Stock 33-45611
Oryx Energy Company $600,000,000 Debt
Securities 33-33361
Oryx Energy Company 7,259,394 shares of
Common Stock 33-36799
On Form S-8 for:
Oryx Energy Company 1992 Long-Term
Incentive Plan 33-42695
Oryx Energy Company Long-Term Incentive Plan 33-25032
Oryx Energy Company Capital Accumulation Plan 33-24918
Pursuant to Rule 436(c) under the Securities Act of 1933, this
report should not be considered a part of the registration
statement prepared or certified by us within the meaning of
Sections 7 and 11 of that Act.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
August 9, 1994
