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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): MAY 19, 1998
CROSS TIMBERS OIL COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 1-10662 75-2347769
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
810 HOUSTON STREET, SUITE 2000, FORT WORTH, TEXAS 76102
(Address of principal executive offices) (Zip Code)
(817) 870-2800
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS.
On May 19, 1998, Cross Timbers Oil Company, a Delaware corporation
("the Company"), issued news release number 98-11 (Exhibit 99.1) regarding
announcements made at its annual meeting of shareholders.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
Exhibit Number
and Description Page
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99.1 Cross Timbers Oil Company News Release Number 98-11 4
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SIGNATURES
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 hereunto duly authorized.
CROSS TIMBERS OIL COMPANY
Date: May 26, 1998 By: LOUIS G. BALDWIN
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Louis G. Baldwin
Senior Vice President and
Chief Financial Officer
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EXHIBIT 99.1
[CROSS TIMBERS OIL COMPANY NEWS RELEASE LETTERHEAD]
NUMBER 98-11
CROSS TIMBERS RAISES 1999 GOALS
FORT WORTH, TX (MAY 19, 1998) - At its Annual Meeting today, Cross Timbers
Oil Company's (NYSE-XTO) Chairman and CEO Bob R. Simpson announced that, as a
result of the recently completed East Texas acquisition, the Company has raised
its strategic goals for 1999.
"Last year we challenged ourselves to duplicate our 50% growth goal over a
two-year period beginning January 1, 1998," Simpson said. "Our goals were to
achieve cash flow per share of $3.67 and reserves per share of 5.4 BOE during
1999. The right acquisition at the right time gave us the ability to strengthen
our balance sheet with equity and to meet our targets ahead of schedule. As a
result, we have increased our 1999 cash flow per share goal to $4.00.
"Proved reserves per share at year-end 1999 are now targeted at 36 Mcfe of
gas or 6.0 BOE. Our debt per Mcfe target, however, will remain at $0.40. These
goals assume commodity price levels of $18 per barrel of oil and $2.20 per Mcf
of gas, net to the Company," he said.
The Company also announced plans to make strategic acquisitions totaling
$150 million between now and the end of 1999. Included in this total is the
potential repurchase of the 1.5 million shares remaining under the currently
authorized 3.0 million share common stock repurchase program.
Annual exploration and development expenditures of $100 million to $120
million are expected in 1999, depending on drilling results, property
acquisitions and commodity prices. Higher-risk expenditures, including step-out
development and exploratory drilling, are targeted at 10% to 15% of these
amounts.
"We expect development expenditures to be funded from cash flow while
acquisitions
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PAGE 2 - CROSS TIMBERS RAISES 1999 GOALS
and stock repurchases will be funded with a combination of cash flow and debt,"
Simpson added. "With our recent equity offering, we can immediately fund in
excess of $400 million in acquisitions with low-cost bank financing. If larger
strategic acquisition opportunities arise, we will consider funding them with
equity, depending on market conditions."
Steve Palko, Cross Timbers' President, and other members of Cross Timbers'
Senior Management reviewed the Company's operations.
"Both the San Juan Basin and East Texas Basin acquisitions are on target
with our expectations. In the San Juan Basin, we have already begun
restimulations and compression and artificial lift installations. We also are
preparing to drill as many as 20 wells in the San Juan Basin this year," Palko
noted.
"In the East Texas Basin, we took over operations at the end of April and
are making preparations to improve the pipeline infrastructure and to optimize
compression and artificial lift. We plan to drill as many as 20 wells in East
Texas this year," he said.
Cross Timbers Oil Company is engaged in the acquisition, exploitation and
development of quality, long-lived producing oil and gas properties. The
Company, whose predecessor companies were established in 1986, completed its
initial public offering in May 1993. Its properties are concentrated in Texas,
Oklahoma, Kansas, New Mexico and Wyoming.
CONTACT: LOUIS G. BALDWIN
SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
CROSS TIMBERS OIL COMPANY
817/870-2800
Statements concerning future financial results, production, development
expenditures and future acquisitions and debt levels are forward-looking
statements. These statements are based on assumptions concerning commodity
prices, drilling results and production costs that management believes are
reasonable based on currently available information; however, management's
assumptions and the Company's future performance are both subject to a wide
range of business risks, and there is no assurance that these goals and
projections can or will be met. Further information is available in the
Company's filings with the Securities and Exchange Commission, which are
incorporated by this reference as though fully set forth herein.
