<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(MARK ONE)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE QUARTERLY PERIOD ENDED September 30, 1998
--------------------------------
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE TRANSITION PERIOD FROM ____________________ TO ____________________.
COMMISSION FILE NUMBER 0-18205
-----------------
OEC COMPRESSION CORPORATION
- ------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Oklahoma 73-1345732
- ------------------------------------------------------------------------------
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
2501 Cedar Springs Road, Suite 600, Dallas, Texas 75201
- ------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
214-953-9560
- ------------------------------------------------------------------------------
(Issuer's telephone number)
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
--- ---
Number of Shares of Common Stock Outstanding on November 20,1998 - 29,161,543
Transitional Small Business Format (Check one): Yes ; No X
--- ---
1
<PAGE>
OEC COMPRESSION CORPORATION
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PART I
FINANCIAL INFORMATION:
Item 1 - Financial Statements
Consolidated Balance Sheets
September 30, 1998 and December 31, 1997..............................3
Consolidated Statements of Operations
Three and Nine Months Ended September 30, 1998 and 1997 ..............4
Consolidated Statements of Cash Flows
Nine Months Ended September 30, 1998 and 1997.........................5
Notes to Consolidated Financial Statements..............................7
Item 2 - Management's Discussion and Analysis of the
Consolidated Financial Statements.....................................9
PART II
OTHER INFORMATION:
Item 5 - Other Information .............................................12
Item 6 - (a) Exhibits ..................................................12
Signatures .............................................................13
</TABLE>
2
<PAGE>
OEC COMPRESSION CORPORATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
SEPTEMBER 30, DECEMBER 31,
1998 1997
---- ----
UNAUDITED
(in thousands)
<S> <C> <C>
Current Assets:
Cash and cash equivalents .................................................... $ 7 $ 1
Accounts receivable, less allowances for doubtful accounts
of $84 and $75 in 1998 and 1997, respectively .............................. 2,477 2,782
Income tax receivable ........................................................ 209 212
Compressors and compressor parts inventory ................................... 7,914 2,674
Other ........................................................................ 417 282
--------- ---------
Total current assets ...................................................... 11,024 5,951
Property and equipment, net (Note 2) ........................................... 88,518 76,888
Note receivable - related party ................................................ 342 332
Goodwill and other intangibles, net of amortization of
$1,953 in 1998 and $1,819 in 1997 ............................................ 1,659 1,175
Other assets, net .............................................................. 1 19
--------- ---------
Total assets .............................................................. $ 101,544 $ 84,365
--------- ---------
--------- ---------
Current Liabilities:
Current portion of long-term debt ............................................ $ -- $ 5
Current portion of capital lease payable ..................................... 341 251
Accounts payable and accrued liabilities ..................................... 3,096 4,435
--------- ---------
Total current liabilities ................................................. 3,437 4,691
Long-term debt ................................................................. 54,678 39,076
Capital lease obligation ....................................................... 1,417 213
Deferred income taxes .......................................................... 10,559 10,142
Other .......................................................................... 89 90
--------- ---------
Total Liabilities ......................................................... 70,180 54,212
Minority Interest .............................................................. 2,002 1,418
Commitments (Note 4)
Stockholders' Equity:
Preferred stock, $1.00 par value, 1,000,000
shares authorized, none issued .............................................. -- --
Common stock, $.01 par value, 60,000,000 shares
authorized, 29,170,710 and 29,080,710 shares
issued and 29,161,543 and 29,071,643 outstanding in
1997 and 1998, respectively ................................................ 292 290
Additional paid-in capital ................................................... 31,840 31,797
Accumulated deficit .......................................................... (2,761) (3,343)
Treasury stock, at cost (9,167 and 9,067 shares in 1998
and 1997, respectively) .................................................... (9) (9)
--------- ---------
Total stockholders' equity .................................................. 29,362 28,735
--------- ---------
Total Liabilities and Stockholders' Equity ................................ $ 101,544 $ 84,365
--------- ---------
--------- ---------
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
3
<PAGE>
OEC COMPRESSION CORPORATION
CONSOLIDATED STATEMENTS OF OPERATION
UNAUDITED
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
-------------------- --------------------
1998 1997 1998 1997
-------- -------- -------- --------
(In thousands, except for per share amounts)
<S> <C> <C> <C> <C>
Revenues:
Compressor rentals and service fees $ 5,893 $ 3,831 $ 16,986 $ 7,258
Compressor sales and re-manufacturing 113 238 520 766
Oil & gas sales 493 696 1,686 1,884
-------- -------- -------- --------
Total revenues 6,499 4,765 19,192 9,908
-------- -------- -------- --------
Expenses:
Operating costs - compressors 2,426 1,417 6,776 2,754
Cost of compressor sales and re-manufacturing 97 229 502 693
Operating costs - oil and gas 130 188 526 564
Depreciation, depletion and amortization 1,485 1,232 4,197 2,461
General and administrative 1,138 935 2,940 2,285
-------- -------- -------- --------
Total expenses 5,276 4,001 14,941 8,757
-------- -------- -------- --------
Income from operations 1,223 764 4,251 1,151
-------- -------- -------- --------
Other income (expense):
Gain on sale of assets 13 -- 18
Interest income and other 72 14 172 15
Interest expense (1,241) (596) (3,283) (934)
Minority interest in results of oil and gas operations (46) -- (116) --
Contingent warrant expense -- (1,440) -- (1,440)
-------- -------- -------- --------
(1,202) (2,022) (3,209) (2,359)
-------- -------- -------- --------
Income (loss) before income taxes
and extraordinary item 21 (1,258) 1,042 (1,208)
Income tax expense (17) (87) (418) (106)
-------- -------- -------- --------
Net income (loss) before extraordinary item 4 (1,345) 624 (1,314)
-------- -------- -------- --------
Extraordinary item:
Write off of unamortized debt issue costs
on debt retirement (net of $28 tax) -- -- (42) --
-------- -------- -------- --------
Net income (loss) $ 4 $ (1,345) $ 582 $ (1,314)
-------- -------- -------- --------
-------- -------- -------- --------
Basic and diluted net income (loss) before
extraordinary item per common share $ .00 $ (.05) $ .02 $ (.05)
-------- -------- -------- --------
-------- -------- -------- --------
Extraordinary item $ .00 $ .00 $ .00 $ .00
-------- -------- -------- --------
-------- -------- -------- --------
Basic and diluted net income (loss) per common share $ .00 $ (.05) $ .02 $ (.05)
-------- -------- -------- --------
-------- -------- -------- --------
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
4
<PAGE>
OEC COMPRESSION CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
1998 1997
------- -------
(In thousands)
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) .................................... $ 582 $(1,314)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depletion, depreciation, and amortization ............ 4,197 2,461
Accretion of discount on debt ........................ 37 --
Write off of unamortized debt issue costs ............ 42 --
Deferred income taxes ................................ 445 92
Minority interest in results of oil and gas
operations ......................................... 116 --
Gain on sale ......................................... (18) --
Contingent Warrant expense ........................... -- 1,440
Changes in operating assets and liabilities:
Accounts receivable and other ........................ 305 (56)
Notes receivable ..................................... 12 9
Compressor and compressor parts inventory ............ (4,327) (1,556)
Accounts payable and accrued liabilities ............. (1,922) (654)
Other ................................................ (137) (286)
------- -------
Net cash provided by (used in) operating
activities ...................................... (668) 136
------- -------
Cash flows from investing activities:
Acquisitions of compressor and other equipment ....... (14,971) (6,942)
Proceeds from disposition of compressor and other
equipment .......................................... 102 --
Proceeds from disposition of oil and gas properties .. 681 --
Additions to oil and gas properties .................. (396) (718)
Business acquisition, net of cash acquired ........... -- (23,792)
------- -------
Net cash used in investing activities ............ (14,584) (31,452)
------- -------
Cash flows from financing activities:
Proceeds of long-term debt ........................... 40,920 34,984
Payments on long-term debt ........................... (24,777) (3,239)
Payments on capital lease payable .................... (335) (43)
Debt issue costs ..................................... (695) (453)
Proceeds from stock transactions ..................... 45 59
Capital contributions ................................ 100 --
------- -------
Net cash provided by financing activities ........ 15,258 31,308
------- -------
Net increase (decrease) in cash and cash equivalents ... 6 (8)
Cash and cash equivalents, beginning of period ......... 1 10
------- -------
Cash and cash equivalents, end of period ............... $ 7 $ 2
------- -------
------- -------
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
5
<PAGE>
OEC COMPRESSION CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
UNAUDITED
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
1998 1997
------- -------
(In thousands)
<S> <C> <C>
Supplemental disclosure of cash flow information:
Interest paid .............................................. $ 2,799 $ 761
------- -------
------- -------
Income taxes paid .......................................... $ -- $ 30
------- -------
------- -------
Non-Cash investing and financing activities:
Capital leases of compressor equipment ..................... $ 1,629 $ --
Revaluation of compressors and compressor parts inventory
in connection with acquisition of subsidiary ............. $ 913 $ --
Contribution of oil and gas properties by minority
interest owner ........................................... $ 368 $ --
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
6
<PAGE>
OEC COMPRESSION CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED
NOTE 1 ORGANIZATION AND BASIS OF PRESENTATION
OEC Compression Corporation, formerly Equity Compression Services
Corporation, formerly Hawkins Energy Corporation (the "Company") is engaged
in the leasing, contract management, outsourcing, re-manufacturing and direct
sale of gas compression equipment to operators of producing natural gas wells
and gas gathering systems and in the production of natural gas and oil. Its
principal geographical operating areas lie within the states of Alabama,
Mississippi, Louisiana, Oklahoma, Arkansas, Kansas, and Texas.
The consolidated financial statements include the accounts of the
Company, its wholly owned subsidiaries Ouachita Energy Corporation
("Ouachita"), Equity Leasing Corporation, Sunterra Energy Corporation
("Sunterra") and its oil and gas venture Sunterra Petroleum Company, L.L.C.,
("Sunterra L.L.C."), which was 73% owned at September 30, 1998. All
intercompany transactions have been eliminated.
In the opinion of the Company, the accompanying financial statements
contain all adjustments necessary (all of which are of a normal recurring
nature) to present fairly the financial position of OEC Compression
Corporation and its wholly owned subsidiaries as of September 30, 1998, and
the results of its operations and cash flows for the periods ended September
30, 1998 and 1997. Certain prior period amounts have been reclassed to
conform to 1998 presentation.
The financial statements should be read in conjunction with the
Company's Form 10-KSB for the year ended December 31, 1997. The year-end
Consolidated Balance Sheet data was derived from audited financial
statements, but does not include all disclosures required by generally
accepted accounting principles.
NOTE 2 PROPERTY AND EQUIPMENT
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1998 1997
----------- ------------
(In thousands)
<S> <C> <C>
Land and building ....................................... $ 1,856 $ 1,693
Compressor equipment .................................... 90,202 76,056
Oil and gas properties, on the full cost method ......... 37,584 37,374
Other equipment ......................................... 3,561 2,317
-------- --------
133,203 117,440
Less accumulated depreciation, depletion and
amortization .......................................... 44,685 40,552
-------- --------
Net property and equipment .............................. $ 88,518 $ 76,888
-------- --------
-------- --------
</TABLE>
NOTE 3 TRANSACTIONS WITH RELATED PARTIES
The Company transacts business with certain companies, which are
directly controlled by members of the Company's Board of Directors. The terms
of these transactions are equivalent to the terms of transactions conducted
with non-related parties.
NOTE 4 COMMITMENTS
The Company leases compressor equipment under contracts with terms
ranging from month to month to five years. The future revenues to be received
under contracts at September 30, 1998 are $2.1 million and $5.9 million in
1998 and 1999, respectively.
7
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 5 EARNINGS PER SHARE
Earnings per share (EPS) is computed based on the weighted average
number of shares of common stock outstanding during the period.
The following is a reconciliation of basic and diluted EPS computations:
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
1998 1997 1998 1997
<S> <C> <C> <C> <C>
Basic:
Net income (loss) $ 4 $ (1,345) $ 582 $ (1,314)
Common Stock 29,162 25,763 29,151 24,331
-------- -------- -------- --------
Basic EPS $ .00 $ (.05) $ .02 $ (.05)
-------- -------- -------- --------
-------- -------- -------- --------
Effect of dilutive securities:
Warrants 4,342 -- 4,706 --
Common Stock Options 233 -- 271 --
-------- -------- -------- --------
4,575 -- 4,977 --
Diluted:
Net income (loss) $ 4 $ (1,345) $ 582 $ (1,314)
Common stock and dilutive securities 33,737 25,763 34,128 24,331
-------- -------- -------- --------
Diluted EPS $ .00 $ (.05) $ .02 $ (.05)
-------- -------- -------- --------
-------- -------- -------- --------
</TABLE>
NOTE 6 PRO FORMA FINANCIAL INFORMATION
On August 6, 1997, the Company completed the acquisition of 100% of
the common stock of Ouachita Energy Corporation and the majority of the
assets of both Ouachita Compression Group, LLC and Ouachita Energy Partners,
LTD. The following unaudited pro forma consolidated results of operations for
the nine months ended September 30, 1997 assuming the acquisition occurred as
of January 1, 1997 are:
<TABLE>
<CAPTION>
(In thousands)
<S> <C>
Revenue $ 16,528
Net loss $ (1,479)
Loss per share $ (.05)
Weighted average number of shares outstanding 31,931
</TABLE>
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is Management's discussion and analysis of certain
significant factors which have affected the Company's earnings and financial
condition during the periods included in the accompanying Consolidated
Balance Sheets, Statements of Operations and Cash Flows.
RESULTS OF OPERATIONS
1998 VERSUS 1997
In the third quarter of 1998, the Company had net income of $4,000
compared to a net loss of $1.3 million for the third quarter of 1997. For
the nine months ended September 30, 1998, the Company reported net income of
$582,000 compared to a net loss of $1.3 million for the same period in 1997.
The Company's income from operations increased 60% and 269% for the three and
nine months ended September 30, 1998, respectively when compared to the same
period in 1997.
The improved earnings for both the third quarter and nine month
periods resulted from increased levels of compression equipment deployed on
rental-with-maintenance and contract compression jobs as well as the absence
of $1.4 million expense associated with the issuance of warrants recognized in
the third quarter of 1997. The sources of this growth are internal growth and
the acquisition of working compression equipment, the largest being the
Ouachita acquisition completed in August 1997. Total compression horsepower
deployed on contracts ("earning compression horsepower") as of September 30,
1998 had increased 17% from December 31, 1997 levels. Growth for the comparable
nine month period in fiscal year 1997 (proforma for the Ouachita Acquisition)
was 11%.
Compressor rental and contract revenues increased 54% and 134% for
the three and nine months ended September 30, 1998, respectively when
compared to the same periods in 1997, as a result of the growth previously
described. The average fleet horsepower utilization rate for the nine months
ended September 30, 1998 remained flat as compared to the same period in 1997
at 81%. Revenues from the sale of compressors and re-manufacturing services
decreased 53% and 32% for the three and nine months ended September 30, 1998,
respectively due to the Company's concentration of shop labor on the
maintaining and enhancing of the rental/contract compressor fleet.
Compressor operating costs incurred on rental and contract units
increased 71% and 146% for the three and nine months ended September 30,
1998, respectively as a result of the increased horsepower on lease.
Compressor operating cost growth outpacing revenue growth is principally due
to incremental costs associated with installing additional equipment as well
as start-up costs in new operating regions. The cost of compressor and
re-manufacturing sales decreased 58% and 28% for the three and nine months
ended September 30, 1998, respectively due to the concentration of shop labor
on maintaining and enhancing the rental/contract fleet.
Total revenues from oil and gas sales decreased 29% and 11% for the
three and nine months ended September 30, 1998, respectively as a result of
the decline in the average oil and gas price received by the Company. The
price per barrel decreased from $20.77 to $14.06, or 32% while the price per
MCF decreased 30%, from $2.79 to $1.94 for the nine months ended September
30, 1998, respectively. During May, 1998 the Company sold 44% of its oil
reserves (12% of total reserves) which resulted in a 79% and 41% decline in
barrels of oil sold for the three and nine months ended September 30, 1998,
respectively. The volume of natural gas produced increased by 92% and 72% for
the three and nine months ended September 30, 1998, respectively which
lessened the impact of the lower natural gas price received by the Company.
This increase in volume is a result of the successful completion of four
natural gas wells and the properties contributed by Prize since October 1,
1997 associated with the formation of Sunterra L.L.C.. Oil and gas operating
costs for the three and nine months ended September 30, 1998 decreased 31%
and 7%, respectively due to efficiencies in the operations of oil and gas and
the sale of the oil wells previously mentioned.
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
Total depreciation, depletion and amortization increased 21% and
71% for the three and nine months ended September 30, 1998, respectively.
Depreciation of the compressor fleet increased 9% and 55% for the three and
nine months ended September 30, 1998, respectively due to additions to the
compressor fleet. Depletion, depreciation, and amortization of the composite
cost of evaluated oil and gas properties is computed on the units-of-
production method based on estimated proved reserves. Total depreciation,
depletion and amortization increased 35% and 42% in the three and nine months
ended September 30, 1998, respectively due to higher volumes of oil and gas
produced.
General and administrative expense increased 22% and 29% for the
three and nine months ended September 30, 1998, respectively due to expenses
associated with the Company's increased level of operations. However, general
and administrative expense as a percentage of total revenues was 18% for the
three months ending September 30, 1998 as compared to 20% for the same period
ending September 30, 1997. For the comparative 9 month trailing periods of
September 30, 1998 and September 30, 1997, the same ratios were 15% and 23%,
respectively.
Interest expense increased by 108% and 251% for the three and nine
months ended September 30, 1998, respectively as a result of increased debt
to fund the Ouachita acquisition and additional borrowings to finance the
growth in the compressor fleet. During this fiscal year, the Company has
purchased a number of idle compressor units as well as compressor parts due
to a favorable market price for the equipment with the expectation of
deploying that equipment on future compression service contracts. The natural
lag between purchase and contract revenue generation has contributed to the
increase in interest expense.
Unamortized debt issue cost of approximately $70,000 associated
with a prior credit facility were expensed in the first quarter of 1998 as an
extraordinary item.
YEAR 2000
During the fourth quarter of 1997, the Company determined that new
software systems were needed to improve the information processing
efficiencies necessary to manage the future growth of the Company. Although
the Year 2000 issue was not a reason for the implementation of the new
software systems, the new systems are Year 2000 compliant and position the
Company to manage the Year 2000 issue with minimal risk from an internal
standpoint. In addition, the Company believes that the potential impact from
our external suppliers and vendors is immaterial. The Company will continue to
monitor the existing software systems, potential effect on operating
compression equipment and the Company's external suppliers and vendors to
develop any contingency plans necessary to insure the Year 2000 issue has no
material impact on the Company's operating efficiency.
FINANCIAL CONDITION AND LIQUIDITY
On March 30, 1998, the Company replaced its previously existing $20
million senior bank credit facility with a new senior bank credit facility.
The initial maximum commitment is $40 million, which can be expanded to $60
million with the future addition of other participating financial
institutions. The facility is a borrowing base revolver effective March,
2000, converting to a three year term loan with a seven year principal
amortization. The credit facility is collateralized by substantially all of
the assets of the Company with the exception of the Company's oil and gas
properties, which have been pledged on the related venture's bank credit
facility. The current borrowing base exceeds $45 million; however; borrowings
are limited to the current $40 million commitment until such time as the
Company's existing bank increases the commitment or additional banks
participate in the credit facility. At November 20, 1998, the unused portion
under the current $40 million commitment cap was approximately $2.8 million.
The Company is currently in discussions with additional banks on
participating in the $60 million credit facility.
In December 1997, Sunterra Petroleum L.L.C., entered into a $10
million bank revolving credit facility with borrowing limited to a borrowing
base determined on the value of the underlying oil and gas reserves. In
December 1999, the revolver converts to a four-year term loan. The credit
facility is collateralized by the venture's oil and gas properties. The
initial commitment is $2 million. At November 16, 1998 the unused portion was
approximately $1.9 million.
10
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
Covenants related to the debt agreements include the maintenance of
specified levels of working capital, tangible net worth and debt service
ratio, as defined by the agreements. Additionally, the agreements prohibit
the payment of dividends and place limitations on the repurchase of shares of
the Company's stock and the incurrence of new borrowings. During the third
quarter 1998, the Company was not in compliance with two covenants of its
debt agreements which were waived by the lenders.
Net cash used by operating activities decreased to $668,000 in 1998
from net cash provided by operating activities of $136,000 in 1997 primarily
due to increased levels of compressor and compressor parts inventory and
accounts payable and accrued expense. Net cash used in investing activities
decreased to $14.6 million in 1998 from $31.5 million in 1997. With regards
to the latter, fiscal year 1997 included a $23.8 million cash investment due
to the August, 1997 Ouachita Acquisition. Net cash provided by financing
activities decreased to $15.3 million from $31.3 million in 1997. The 1997
level was the result of the debt financing of the cash portion of the Ouachita
Acquisition ($23.8 million). At September 30, 1998, the Company had current
assets of $11.0 million and current liabilities of $3.4 million. The Company
anticipates that 1998 cash flow from operations, as well as the Company's
senior bank credit facility will be sufficient to fund the Company's working
capital and capital expenditure needs.
11
<PAGE>
PART II
OTHER INFORMATION
ITEM 5. OTHER INFORMATION
Effective September 3, 1998 the Company's common stock was approved
for listing on the American Stock Exchange under the symbol "OOC".
ITEM 6. EXHIBITS
(a) Exhibits:
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
12
<PAGE>
SIGNATURES
Pursuant to the requirements of Sections 13 of 15(d) 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.
OEC COMPRESSION CORPORATION
DATE: November 20, 1998 By: /s/ Matthew S. Ramsey
--------------------------------------
MATTHEW S. RAMSEY
President and Chief Executive Officer
DATE: November 20, 1998 By: /s/ Jack D. Brannon
--------------------------------------
JACK D. BRANNON
Senior Vice President and
Chief Financial Officer
13
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
No. Description
- ------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
14
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 7
<SECURITIES> 0
<RECEIVABLES> 2,561
<ALLOWANCES> 84
<INVENTORY> 7,914
<CURRENT-ASSETS> 11,024
<PP&E> 133,203
<DEPRECIATION> 44,685
<TOTAL-ASSETS> 101,544
<CURRENT-LIABILITIES> 3,437
<BONDS> 0
0
0
<COMMON> 292
<OTHER-SE> 29,070
<TOTAL-LIABILITY-AND-EQUITY> 101,544
<SALES> 19,192
<TOTAL-REVENUES> 19,192
<CGS> 7,804
<TOTAL-COSTS> 14,941
<OTHER-EXPENSES> 116
<LOSS-PROVISION> 73
<INTEREST-EXPENSE> 3,283
<INCOME-PRETAX> 1,042
<INCOME-TAX> 418
<INCOME-CONTINUING> 624
<DISCONTINUED> 0
<EXTRAORDINARY> 42
<CHANGES> 0
<NET-INCOME> 582
<EPS-PRIMARY> .02
<EPS-DILUTED> .02
</TABLE>
