FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For Quarter ended September 30, 1997
Commission File No. 0-18774
Spindletop Oil & Gas Co.
(Exact name of registrant as specified in its charter)
Texas 75-2063001
(State or other jurisdiction of (IRS Employer or I.D.#)
incorporation or organization)
9319 LBJ Fry., #205, Dallas, TX 75243
(Address of principle executive offices) (Zip Code)
(972)644-2581
(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 of 15 (d) of the Securities Exchange Act of 1934
during the preceding twelve 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 ninety (90) days.
YES X NO
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock - $.01 par value 7,488,304
(Title of Class) (Number of shares Outstanding
on November 12, 1997)
1
<PAGE>
Spindletop Oil & Gas Co. and Subsidiaries
FORM 10-Q September 30, 1997
INDEX
Part I Financial Information: Page No.
Item 1. Financial Statements.
Consolidated Balance Sheets
September 30, 1997 (Unaudited) and December 31, 1996...............3
Consolidated Statements of Operations (Unaudited)
Nine Months and Three Months Ended September 30, 1997 and 1996.....5
Consolidated Statements of Cash Flows (Unaudited)
Nine Months Ended September 30, 1997 and 1996 .....................6
Notes to Consolidated Financial Statements ..........................7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations..................................8
Part II Other Information:
Item 6. Exhibits and Reports on Form 8-K... ..........................9
2
<PAGE>
Part I Financial information
Item 1. Financial statements
Spindletop Oil & Gas Co. and Subsidiaries
Consolidated Balance Sheets
<TABLE>
<CAPTION>
September 30, December 31,
1997 1996
------------- -------------
(Unaudited)
Assets
Current Assets
<S> <C> <C>
Cash $ 387,000 $ 476,000
Accounts receivable 639,000 399,000
Accounts receivable, related parties 3,000 34,000
Receivable from shareholder - 34,000
Inventory 9,000 31,000
----------- ---------
Total Current Assets 1,038,000 974,000
----------- ---------
Property and Equipment - at cost
Oil and gas properties (full cost method) 2,835,000 2,522,000
Rental equipment 329,000 329,000
Gas gathering systems 145,000 145,000
Other property and equipment 189,000 178,000
----------- ---------
3,498,000 3,174,000
Accumulated depreciation and amortization (2,233,000) (2,055,000)
----------- ----------
1,265,000 1,119,000
----------- ----------
Other Assets,net of accumulated amortization
of $74,000 and $65,000 at September 30, 1997
and December 31, 1996 respectively 52,000 61,000
---------- ----------
Total Assets $ 2,355,000 $ 2,154,000
========== ==========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
Spindletop Oil & Gas Co. and Subsidiaries
Consolidated Balance Sheets
<TABLE>
<CAPTION>
September 30, December 31,
1997 1996
---------- ----------
(Unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
<S> <C> <C>
Accounts payable and accrued liabilities $ 790,000 $ 638,000
Current portion of long-term debt 5,000 12,000
Tax savings benefit payable 94,000 94,000
---------- ----------
Total Current Liabilities 889,000 744,000
---------- ----------
Shareholders' Equity
Common stock, $.01 par value;
100,000,000 shares authorized; 7,488,304
issued (7,488,304 at December 31, 1996) 75,000 75,000
Additional paid-in capital 727,000 727,000
Retained earnings 664,000 608,000
---------- ----------
1,466,000 1,410,000
---------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 2,355,000 $ 2,154,000
========== ==========
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
Spindletop Oil & Gas Co. and Subsidiaries
Consolidated Statements Of Operations
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
---------------------- --------------------
1997 1996 1997 1996
----------- --------- ---------- ----------
Revenues
<S> <C> <C> <C> <C>
Oil and gas revenues $ 936,000 $ 958,000 $ 247,000 $ 339,000
Revenue from lease operations 140,000 166,000 46,000 57,000
Sale of natural gas 65,000 - 25,000 -
Gas gathering fees 15,000 14,000 6,000 4,000
Equipment rental 83,000 85,000 31,000 26,000
Interest Income 6,000 3,000 2,000 1,000
Other 2,000 - - -
---------- ---------- --------- ----------
1,247,000 1,226,000 357,000 427,000
---------- ---------- --------- ----------
Expenses
Pipeline and rental operations 56,000 39,000 16,000 11,000
Gas purchases 46,000 - 18,000 -
Lease operations 492,000 509,000 187,000 153,000
Depreciation and amortization 187,000 181,000 65,000 71,000
General and administrative 409,000 382,000 132,000 108,000
Interest expense 1,000 2,000 - -
---------- ---------- --------- ---------
1,191,000 1,113,000 418,000 343,000
---------- ----------- ---------- ---------
Net Income (loss) $ 56,000 $ 113,000 $(61,000) $ 84,000
========= ========== ========== =========
Net Income Per Share
of Common Stock $ .01 $ .02 $ (.01) $ .01
========== ========== ========== =========
Weighted average shares
outstanding 7,488,304 7,488,304 7,488,304 7,488,304
========== ========== ========== =========
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
Spindletop Oil & Gas Co. and Subsidiaries
Consolidated Statements Of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
---------------------
1997 1996
--------- ---------
Cash Flows from Operating Activities
<S> <C> <C>
Net Income $ 56,000 $ 113,000
Reconciliation of net income to
net cash provided by operating activities:
Depreciation and amortization 187,000 181,000
(Increase) decrease in accounts receivable (209,000) (45,000)
(Increase) decrease in inventory 22,000 (23,000)
Increase (decrease) in accounts payable 53,000 (105,000)
--------- ---------
Net cash provided (used) by operating activies 209,000 121,000
--------- ---------
Cash Flows from Investing Activities
Capitalized acquisition, exploration
and development costs (313,000) (86,000)
Purchase of property and equipment (13,000) (28,000)
Principal collected on note receivabe --
--------- ---------
Net cash used by investing activities (326,000) (114,000)
--------- ---------
Cash Flows from Financing Activities
Repayment of notes payable (13,000) (8,000)
Proceeds from borrowings 8,000 10,000
Advances to shareholder (137,000) 55,000
Repayment of shareholder loan 170,000 (20,000)
Net cash provided (used) by financing activi 28,000 37,000
--------- --------
Increase (Decrease) in cash (89,000) 44,000
Cash at beginning of period 476,000 229,000
-------- ---------
Cash at end of period $ 387,000 $ 273,000
======== =========
</TABLE>
See accompanying notes to financial statements.
6
<PAGE>
Spindletop Oil & Gas Co. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)
Note 1. Basis of Presentation
The accompanying financial statements are presented in accordance with the
requirements of Form 10-Q and consequently do not include all of the disclosures
normally required by generally accepted accounting principles or those normally
made in the Company's annual Form 10-K filing. Accordingly, the reader of this
form 10-Q may wish to refer to the Company's Form 10-K for the year ended
December 31, 1996 for further information.
In the opinion of management, the accompanying interim financial statements
contain all material adjustments, consisting only of normal recurring
adjustments necessary to present fairly the financial condition, the results of
operations and changes in cash flows of the Company and its consolidated
subsidiary for the interim periods.
Note 2. Subsequent events
Stock Split
In December 1996 the Board of Directors declared a 1-for-6 reverse stock split
on the Company's common stock. The record date was January 31, 1997. all share
and per share data as appropriate, reflect this split. The effect of the split
is presented retroactively within stockholder's equity at December, 1996 by
transferring the par value for the additional shares issued from additional
paid-in capital to the common stock accounts.
7
<PAGE>
Spindletop Oil & Gas Co. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operation
Results of Operations
Nine months ended September 30, 1997 compared with 1996
In December 1996 the Company expanded its current pipeline system by acquiring,
at no cost, a pipeline system in Hood County, Texas. The Company began
purchasing natural gas of other producers and reselling this gas to a pipeline
marketing affiliate. Therefore both gas purchases and natural gas sales
increased in 1997.
Three months ended September 30, 1997 compared to 1996
Oil and gas revenues decreased primarily because of a decrease in gas prices.
Lease operating expenses increased because due to workovers of existing wells.
Gas purchases and sale of natural gas increased due to the acquisition of the
pipeline system described above.
Financial Condition and Liquidity
The Company's operating capital needs, as well as its capital spending program
are generally funded from cash flow generated by operations. Because future cash
flow is subject to a number of variables, such as the level of production and
the sales price of oil and natural gas, the Company can provide no assurance
that its operations will provide cash sufficient to maintain current levels of
capital spending. Accordingly, the Company may be required to seek additional
financing from third parties in order to fund its exploration and development
programs.
8
<PAGE>
Spindletop Oil & Gas Co. and Subsidiaries
September 30, 1997
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
<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.
SPINDLETOP OIL & GAS CO.
(Registrant)
DATE: November 12, 1997 By: /s/Paul E. Cash
----------------
Paul E. Cash
President
DATE: November 12, 1997 By: /s/ Gary Goodnight
-------------------
Gary Goodnight
Controller
10
<PAGE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> Dec-31-1997
<PERIOD-START> Jan-1-1997
<PERIOD-END> Sep-30-1997
<EXCHANGE-RATE> 1
<CASH> 387,000
<SECURITIES> 0
<RECEIVABLES> 642,000
<ALLOWANCES> 0
<INVENTORY> 9,000
<CURRENT-ASSETS> 1,038,000
<PP&E> 3,498,000
<DEPRECIATION> 2,233,000
<TOTAL-ASSETS> 2,355,000
<CURRENT-LIABILITIES> 889,000
<BONDS> 0
0
0
<COMMON> 75,000
<OTHER-SE> 1,391,000
<TOTAL-LIABILITY-AND-EQUITY> 1,466,000
<SALES> 936,000
<TOTAL-REVENUES> 1,247,000
<CGS> 0
<TOTAL-COSTS> 492,000
<OTHER-EXPENSES> 698,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,000
<INCOME-PRETAX> 56,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 56,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 56,000
<EPS-PRIMARY> .01
<EPS-DILUTED> 0
</TABLE>
