SECURITIES AND EXCHANGE COMMISSION
Washington DC 20549
Form 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
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 1-11516
REMINGTON OIL AND GAS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 75-2369148
(State or other jurisdiction of (IRS employer identification no.)
incorporation or organization)
8201 Preston Road, Suite 600, Dallas, Texas 75225-6211
(Address of principal executive offices)
(Zip code)
(214) 890-8000
(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 shorter period than
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
--- ---
There were 3,221,510 outstanding shares of Class A (Voting) Common
Stock, $1 par value, on May 12, 1998. There were also 17,135,161
outstanding shares of Class B (Non-Voting) Common Stock, $1 par value,
on such date.
<PAGE>
Remington Oil and Gas Corporation
INDEX
PART I FINANCIAL INFORMATION 3
Item 1. Financial Statements 3
Condensed Balance Sheets 3
Condensed Statements of Income 4
Condensed Statements of Cash Flows 5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II OTHER INFORMATION 11
Item 1. Legal Proceedings 11
Item 2. Changes in Securities 11
Item 3. Defaults upon Senior Securities 11
Item 4. Submission of Matters to a Vote of
Security Holders 11
Item 5. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
<PAGE>
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Remington Oil and Gas Corporation
Condensed Balance Sheets
(In thousands, except share data)
March 31, December 31,
Assets 1998 1997
----------- ------------
Current assets (Unaudited)
Cash and cash equivalents $ 3,253 $ 4,552
Accounts receivable - oil and natural
gas 4,918 5,725
Accounts receivable - other 74 268
Note receivable - S-Sixteen Holding
Company 5,645 6,192
Prepaid expenses and other current
assets 1,770 2,118
----------- ------------
Total current assets 15,660 18,855
----------- ------------
Properties
Unproved oil and gas properties 8,983 8,755
Oil and natural gas properties
(successful-efforts method) 220,341 211,726
Other properties 2,230 2,800
Accumulated depreciation, depletion
and amortization (150,288) (144,548)
----------- -----------
Total properties 81,266 78,733
----------- -----------
Other assets
Deferred charges (net of accumulated
amortization) 874 927
----------- -----------
Total other assets 874 927
----------- -----------
Total assets $ 97,800 $ 98,515
=========== ===========
Liabilities and stockholders' equity
Liabilities
Current liabilities
Accounts payable $ 6,104 $ 8,694
Accrued interest payable 1,055 264
Accrued transportation payable -
related party 281 305
Net Profits expense payable 957 594
Short-term note payable 8,500 6,000
----------- -----------
Total current liabilities 16,897 15,857
----------- -----------
Convertible subordinated notes payable 38,371 38,371
----------- -----------
Total Liabilities 55,268 54,228
----------- -----------
Commitments and contingencies (Note 5)
Stockholders' equity
Common stock, $1.00 par value
Class A (voting) - 15,000,000
shares authorized, 3,250,110
shares issued 3,250 3,250
Class B (non-voting) - 30,000,000
shares authorized, 17,559,433
shares issued 17,559 17,553
Additional paid-in capital 25,230 25,197
Treasury stock, at cost, 28,600 shares
Class A, and 424,272 shares Class B (3,264) (3,465)
Retained earnings (deficit) (243) 1,752
----------- -----------
Total stockholders' equity 42,532 44,287
----------- -----------
Total liabilities and stockholders' equity $ 97,800 $ 98,515
=========== ===========
See accompanying Notes to Financial Statements.
<PAGE>
Remington Oil and Gas Corporation
Condensed Statements of Income
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended March 31,
1998 1997
----------- -----------
Revenues
Oil sales $ 4,327 $ 5,263
Natural gas sales 7,328 10,771
Other income 852 1,193
----------- -----------
Total revenues 12,507 17,227
----------- -----------
Costs and expenses
Operating costs 1,623 780
Transportation expense 747 648
Net Profits expense 1,632 2,469
Exploration expense 1,873 1,398
Depreciation, depletion and
amortization 6,361 5,225
General and administrative expenses 1,162 1,608
Legal expenses 109 891
Reorganization expense - 203
Interest and financing costs 995 1,225
----------- -----------
Total costs and expenses 14,502 14,447
----------- -----------
Income (loss) before income taxes (1,995) 2,780
Income tax expense - 973
----------- -----------
Net income (loss) $ (1,995) $ 1,807
=========== ===========
Basic and diluted income (loss) per share $ (0.10) $ 0.09
=========== ===========
See accompanying Notes to Financial Statements.
<PAGE>
Remington Oil and Gas Corporation
Condensed Statements of Cash Flows
(Unaudited)
(In thousands)
Three Months Ended
March 31,
1998 1997
----------- -----------
Cash flow provided by operations
Net income (loss) $ (1,995) $ 1,807
Depreciation, depletion and
amortization 6,361 5,225
Amortization of deferred charges 53 65
Amortization of premium on marketable
securities - 44
Deferred income tax expense (benefit) - 973
Dry hole and impaired property costs 396 639
Decrease in accounts receivable 1,001 1,412
Decrease (increase) in prepaid
expenses and other current assets 348 (606)
(Decrease) increase in accounts payable
and accrued expenses (1,460) 655
(Gain) loss on sale of properties (70) 2
----------- -----------
Net cash flow provided by operations 4,634 10,216
----------- -----------
Cash from investing activities
Payments for capital expenditures (9,324) (4,767)
Proceeds from property sales 104 1
----------- -----------
Net cash used in investing activities (9,220) (4,766)
Cash from financing activities
Proceeds from note payable 2,500 -
Issuance of common stock in payment
of directors' fees 240 -
Sales and maturities of marketable
securities - 1,790
Investment in marketable securities - (597)
Principal repayments - S-Sixteen
Holding Company 547 -
----------- -----------
Net cash provided by financing
activities 3,287 1,193
----------- -----------
Net increase (decrease) in cash and cash
equivalents (1,299) 6,643
Cash and cash equivalents at beginning
of period 4,552 2,997
----------- -----------
Cash and cash equivalents at end of period $ 3,253 $ 9,640
=========== ===========
See accompanying Notes to Financial Statements.
<PAGE>
Remington Oil and Gas Corporation
Notes to Financial Statements
March 31, 1998
Note 1. Accounting Policies and Basis of Presentation
Remington Oil and Gas Corporation (the "Company"), formerly Box
Energy Corporation, is an independent oil and gas exploration and
production company. The Company's activities and properties are located
in three core areas, offshore Gulf of Mexico, Mississippi/Alabama and
onshore Gulf Coast.
The financial statements are prepared according to the
instructions to Form 10-Q and may not include all disclosures required
for financial statements prepared in conformity with generally accepted
accounting principles. The results of operations and financial position
for the interim periods presented include all transactions and
adjustments which management believe are necessary for fair
presentation. All adjustments are of a normal recurring nature. The
financial statements presented in this Form 10-Q should be read
together with the audited financial statements of the Company for the
year ended December 31, 1997. The results of operations for the three
months ended March 31, 1998, are not necessarily indicative of the
results for the full year. There were no material changes in the
significant accounting policies or details of accounts during the
interim periods except as stated below.
Note 2. Note Receivable S-Sixteen Holding Company
On April 29, 1997, the Company lent S-Sixteen Holding Company
("SSHC") $7.25 million. The original May 29, 1997 due date was extended
to June 3, 1997, at which time the note receivable was replaced by a
new $6.95 million note receivable dated June 3, 1997. The new note
receivable matures May 29, 1998, and requires monthly installment
payments of principal and interest totaling $100,000 commencing June
29, 1997. The interest rate is equal to the prime rate of Chase Bank of
Texas, National Association (formerly known as Texas Commerce Bank
National Association) plus 1% until the sixth month when the rate
escalates monthly by 0.1% over the previous month's rate. Pledged as
collateral under a related Amended and Restated Pledge Agreement (the
"Pledge Agreement") are the 1.8 million shares of the Company's Class A
(Voting) Common Stock ("Class A Stock"), 800,000 shares of CKB
Petroleum, Inc. ("CKBP") common stock and 800,000 shares of CKB &
Associates, Inc. ("Associates") common stock owned by SSHC. The pledged
stock represents approximately 57%, 94% and 94% of the outstanding
shares of the classes of stock, respectively. In case of default, as
defined in the Pledge Agreement, the Company, upon five days' notice to
SSHC, has the right to foreclose upon and sell the collateral stock.
The Pledge Agreement also provides that upon the occurrence and during
the continuance of an event of default, if the collateral has not been
foreclosed upon, the Company may direct the vote of the collateral
stock.
Note 3. Notes Payable
In December 1992, the Company issued $55.1 million of 8 1/4%
Convertible Subordinated Notes ("Notes"). The Notes mature December 1,
2002 and are convertible into shares of Class B (Non-Voting) Common
Stock ("Class B Stock") at the election of the holder any time before
maturity, unless previously redeemed. Interest accrued at 8 1/4% per
annum is payable semiannually on each June 1 and December 1. The
Company may redeem all or a portion of the Notes any time after
December 1, 1995, at 105.775% of the face amount. This percentage
decreases .825% each subsequent December 1. The Notes are unsecured and
subordinate in right of payment to all existing and future senior
indebtedness. The Indenture for the Notes (the "Indenture") requires
the Company to make an offer to repurchase the Notes if a "change in
control" as defined in the Indenture occurs. A "change in control" may
occur in the event of a merger or consolidation in which the holders of
a majority of the Class A Stock immediately prior to the merger or
consolidation do not receive at least a majority of the voting common
stock of the continuing or surviving corporation.
During the second quarter of 1994, the Company established a one-
year line of credit with a bank. The line of credit with a borrowing
base of $10.0 million expires in June 1998. The Company renewed the
line in 1995, 1996 and 1997. The line of credit is collateralized by
the Company's South Pass oil and natural gas properties. The interest
rate for the line of credit is the lender's floating base rate plus
0.5%. The Company has borrowed $8.5 million and has issued letters of
credit totaling $250,000 against this line of credit. At March 31,
1998, two technical defaults existed on the line of credit. The Company
obtained waivers from the bank for the two defaults.
Note 4. Related Party Transactions
S-Sixteen Holding Company controls 57% of the outstanding Class A
Stock of the Company and 94% of the outstanding shares of CKBP. Under
both applicable law and Board of Directors' resolution, transactions
with affiliates must be approved by the Board of Directors, be fair and
reasonable to the Company and be on terms no less favorable to the
Company than can be obtained from an unaffiliated party in an arm's-
length transaction.
CKBP owns a minority interest in the pipeline that transports oil
from South Pass Area (offshore Louisiana) to Venice, Louisiana. The
pipeline tariff is $2.75 per barrel and is published with the Federal
Energy Regulatory Commission. The rate is consistent with rates offered
by unrelated parties from the South Pass Area to Venice. Transportation
incurred and payable to CKBP was $844,000 and $781,000 for the three
months ended March 31, 1998 and 1997, respectively.
In April 1992, the Company acquired all of the assets and assumed
all of the liabilities of OKC Limited Partnership (the "Partnership").
Under the Partnership Agreement, the general partners were entitled to
advancement of litigation expenses in the event they were named parties
to litigation in their capacity as general partners. Accordingly, the
Partnership and later the Company, advanced litigation expenses to the
general partners. In addition, the Company advanced litigation expenses
on behalf of certain directors and officers of the Company in
applicable situations. All of the litigation for which advancements
were made has been either settled or dismissed. However, during the
first quarter of 1997, the Company did advance $115,000 on behalf of
the above parties.
The Company received interest income totaling $159,000 and
principal payments totaling $547,000 from SSHC during the first quarter
of 1998. The balance of the note receivable at March 31, 1998, was $5.6
million. See Note 2. Note Receivable - S-Sixteen Holding Company.
During the three months ended March 31, 1998 and 1997, the Company
incurred executive search fees totaling $7,000 and $76,000,
respectively, to Preng and Associates Inc., an entity controlled by a
member of the Board of Directors.
Note 5. Contingencies
Phillips Petroleum Case
Phillips Petroleum Company ("Phillips") filed a lawsuit against
the Partnership in August 1990. The litigation is currently pending in
Orleans Parish, Louisiana. A non-jury trial was held in April 1997. At
this trial, Phillips claimed that pursuant to its 33% Net Profits
interest in South Pass Block 89, it was entitled to receive an
overriding royalty for months in which "net profits" were not achieved;
that an excessive oil transportation fee was being charged to the Net
Profits account; and that the entire $69.6 million lump sum cash
payment received by the Partnership should have been credited to the
Net Profits account instead of the $5.8 million that was credited. On
the latter claim, Phillips alleged damages in excess of $21.5 million,
while on the first two claims Phillips alleged aggregate damages of
several million dollars. Phillips further contended that it was
entitled to double damages and cancellation of the farmout agreement
that created the Net Profits interest. In addition to contesting the
claims of Phillips, the Company asserted a counterclaim at trial that
Phillips had breached a settlement agreement regarding previous
litigation between the parties and claimed damages in excess of $10.0
million. The parties presented oral arguments to the court on September
3, 1997 and are awaiting a ruling by the trial judge. Certain possible
results of the Phillips Petroleum Case could have a material adverse
effect on the Company.
Other Contingencies
The Company is not a party to any material pending legal
proceedings other than the foregoing.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
The following discussion will assist in the understanding of the
Company's financial position and results of operations. The information
below should be read in conjunction with the financial statements, the
related notes to financial statements and the Company's Form 10-K for
the year ended December 31, 1997.
This discussion contains historical information and certain
forward-looking statements that involve risks and uncertainties about
the business, long-term strategy, financial condition and future of the
Company. Statements concerning results of future exploration,
exploitation, development and acquisition expenditures and expense and
reserve levels are forward-looking statements. These statements are
based on assumptions concerning commodity prices, drilling results and
production, and administrative and interest costs that management
believes are reasonable based on currently available information of
known facts and trends. 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.
Remington Oil and Gas Corporation (the "Company") is an
independent oil and gas exploration and production company. The
activities and properties of the Company are located in the offshore
Gulf of Mexico, onshore Gulf Coast and Mississippi/Alabama. The long-
term strategy is to economically increase reserves, production, and
cash flow on an annual basis, resulting in increased shareholder value.
Capital expenditures financed primarily by operating cash flow and bank
debt will entail a balanced exploration, development and acquisition
program.
Liquidity and Capital Resources
On March 31, 1998, the Company's current liabilities of $16.9
million exceeded current assets of $15.7 million. At December 31, 1997,
current assets of $18.6 million exceeded current liabilities of $15.9
million. The decrease in liquidity resulted from the Company's $9.3
million in capital expenditures during the first quarter of 1998 which
exceeded cash flow from operations of $4.6 million. Capital
expenditures in excess of the cash flow from operations were financed
by a decrease in cash and prepaid drilling costs, and an increase in
current liabilities.
Cash flow from operations decreased $5.6 million, or 55%,
primarily because of lower oil and natural gas sales revenue. Average
oil prices were $7.93 per barrel lower during the first quarter of 1998
compared to the first quarter of 1997. In addition, natural gas
production from South Pass Block 89 Platform B was 367,000 Mcf lower
during the first three months of 1998 compared to the same period in
the prior year. The Company sells natural gas production from South
Pass Block 89 Platform B under a long-term gas sales contract at prices
substantially above market prices. The combination of the lower oil
prices and lower natural gas production caused oil and natural gas
revenue from this Platform to be $ 6.1 million lower in 1998. The
Company expects natural gas production from the existing wells on South
Pass Block 89 Platform B to continue to decrease throughout the next
year. However, significant proved undeveloped natural gas reserves
still exist in this block and management is currently evaluating
several possible courses of action to maximize the profit from this
property.
The effect of lower oil prices and lower natural gas production
from South Pass Block 89 Platform B was partially offset by increased
oil and natural gas production from new or purchased properties.
Discoveries that have begun producing since the end of the first
quarter of last year are primarily the Parker Creek Field and Eugene
Island Block 135. The two properties combined added oil production of
382 bopd and 3.3 MMcfpd during the first quarter of 1998. The Company
completed a third well in the Parker Creek Field in late March of 1998
and expects to complete a fourth well during the second quarter. In
addition, the third Eugene Island Block 135 well began producing in
late March of this year and a discovery well on West Cameron Block 170
is expected to begin producing late in the third quarter of 1998. The
Company made three purchases of oil and natural properties since March
31, 1997 in the onshore Texas Gulf Coast area. Oil and natural gas
production from the purchased properties added 300 bopd and 2.1 MMcfpd
during the first three months of 1998.
Capital expenditures for the first quarter of 1998 primarily
included the drilling and completion costs for two Parker Creek Field
wells, the Eugene Island Block 135 A-3 well and the West Cameron Block
170 #2 discovery well. In addition, the Company purchased a property in
the onshore Texas Gulf Coast area and incurred capital expenditures for
completion costs of the Eugene Island Block 135 A-2 well, a development
well in Mississippi and an exploration well in South Texas.
The Company is committed to an additional well in South Pass Block
87 and has budgeted capital expenditures for another well in South Pass
Block 87, a side track or a new well in South Pass Block 89, additional
development expenditures for West Cameron Block 170, an exploration
well in Main Pass Block 262, additional development wells in the Parker
Creek Field and exploration drilling in the onshore Gulf Coast. The
approved budget for capital expenditures for 1998 totaled $35.0
million. Due to forecast lower oil prices for the remainder of the
1998, the Company anticipates reducing this capital budget by
approximately 20%.
Sources of cash other than from operations include the repayment
of the note receivable from SSHC and additional cash available from
bank borrowings. The Company's existing line of credit with a current
borrowing base of $10.0 million expires in June of this year. The
Company anticipates renewing this line again in 1998. The Company has
borrowed $8.5 million and has issued letters of credit totaling
$250,000 against this line of credit. In addition, at March 31, 1998,
the Company had two technical defaults on the debt covenants of the
existing line of credit. Management has obtained a waiver from the bank
for both defaults.
The Company and Phillips Petroleum Company are engaged in a
dispute concerning the Net Profits interest in South Pass Block 89. A
non-jury trial was held in April 1997. Phillips alleges damages in
excess of $21.5 million on one claim and several million dollars on two
additional claims. Phillips further contended that it was entitled to
double damages and cancellation of the farmout agreement that created
the Net Profits interest. Oral arguments were presented to the court
September 3, 1997 and the Company awaits a decision from the judge.
Certain outcomes of this litigation could have a material adverse
impact on the liquidity of the Company.
Results of Operations
Oil sales revenue decreased $936,000, or 18%, primarily because of
lower oil prices partially offset by an increase in oil production. Oil
prices for the first quarter of 1998 averaged $12.75 compared to $20.68
in the first quarter of 1997. The $7.93 per barrel decrease caused oil
sales revenue to be $2.0 million lower in 1998. However, a net increase
in production of 85,042 barrels offset the effect of lower oil prices
by $1.0 million. Oil production from Mississippi/Alabama increased by
31,192 barrels, or 174%, primarily from the Parker Creek Field, which
began producing in the second quarter of 1997. Oil production from the
onshore gulf coast area increased 27,339 barrels, or 3,247%, because of
production from the Smith Properties that were purchased during the
second half of 1997. Oil production from the offshore Gulf of Mexico
increased 27,487 barrels, or 12%, from the South Pass area blocks and
Eugene Island Block 135 which began producing during the second quarter
of 1997. Other oil properties owned by the Company experienced a slight
decrease in oil production totaling 976 barrels.
Gas sales revenue decreased $3.4 million, or 32%, primarily
because of lower natural gas production from South Pass Block 89
Platform B and Main Pass Block 262 partially offset by an increase in
natural gas production from South Pass Block 87, Eugene Island Block
135 and the Gulf Coast area. Gas production from South Pass Block 89
Platform B decreased 367,223 Mcf, or 67%, and gas production from Main
Pass Block 262 decreased 213,653 Mcf, or 96%, during the first quarter
of 1998 compared to the first quarter of 1997. The decrease in
production caused gas sales revenues to decrease by $4.1 million and
$531,000, respectively. The decrease in gas production was the result
of continued depletion of the gas reserves from South Pass Block 89
Well B-20 and depletion of the proved gas reserves from Main Pass Block
262. The average spot gas price for the first quarter of 1998 decreased
by $0.63, or 21%, compared to the same period in the prior year causing
gas sales revenue to decrease $779,000. Offsetting the decreases in gas
sales revenue was a 617,603 Mcf, or 101%, increase in gas production
from South Pass Block 87, Eugene Island Block 135, and the Gulf Coast
area. The increase in production from these areas added approximately
$1.5 million to gas sales revenue.
Interest income decreased $293,000, or 59%, for the quarter ended
March 31, 1998, compared to the quarter ended March 31, 1997. During
the first quarter of 1997, the Company had over $35.0 million in cash
and marketable securities. Subsequently, the Company liquidated the
marketable securities to purchase property and repurchase $16.7 million
of the Convertible Subordinated Notes. In addition, the Company made a
short-term loan to S-Sixteen Holding Company that has a current balance
of $5.6 million. The decrease in interest income is a result of the
liquidation of the marketable securities, partially offset by interest
income from the S-Sixteen Holding Company Note receivable.
Operating costs and expenses increased $843,000, or 108%, because
of operating expenses incurred on the new producing properties,
properties purchased after the first quarter of 1997 and rig stack
charges on South Pass Block 89 Platform B. Properties that were not
producing in the first quarter of 1997 include Parker Creek and Eugene
Island. Operating expenses for the new properties were $36,000 and
$54,000, respectively. The Company also purchased properties in South
Texas during the third quarter of 1997 and during the first quarter of
1998. Operating cost attributable to the purchased properties during
the first quarter of 1998 was $472,000. During the first quarter of
1998, the Company incurred additional operating costs of approximately
$200,000 for 100% of the rig stack charges for the drill rig on South
Pass Block 89 Platform B. The Company paid for these charges to keep
the drilling rig on the Platform and avoid the higher costs of
demobilizing and subsequently remobilizing the drilling rig while it
evaluated different options for maximizing the potential of the gas
reserves on South Pass Block 89.
Transportation expenses increased $100,000, or 15%, because of the
increased oil production from South Pass Blocks 86, 87 and 89. Net
Profits expense decreased because of the decrease in both oil and gas
sales revenue from South Pass Block 89.
Exploration expenses for the first quarter of 1998 include 2-D and
3-D seismic costs totaling $1.3 million for the Gulf of Mexico seismic
data base and several programs in the Gulf Coast area. Also included is
one dry hole in the Gulf Coast area totaling $396,000 and other
exploration expenses totaling $205,000. During the first quarter of
1997, exploration expenses included dry hole costs totaling $639,000,
seismic expenses totaling $433,000 and other exploration expenses of
approximately $344,000.
Depreciation, depletion and amortization expense increased $1.2
million, or 23%, for the first quarter of 1998 compared to the first
quarter of 1997. Depreciation, depletion and amortization from new
producing properties including Eugene Island Block 135 and Parker Creek
was $532,000 and $313,000, respectively, for the first quarter of 1998.
Depreciation, depletion and amortization from properties acquired
during the third quarter of 1997 and first quarter of 1998 including
the Smith Properties and Provident City properties was $333,000 and
$90,000, respectively.
General and administrative expenses decreased $446,000, or 28%,
primarily because of lower salaries and other related employee benefits
that decreased $453,000. Legal fees decreased $782,000, or 88%, because
of the conclusion of the Phillips Petroleum trial and the settlement or
dismissal of other costly litigation. Reorganization expense incurred
during the first quarter of 1997 included the payment of severance
benefits to employees that either resigned or were terminated during
the first quarter of 1997.
Interest expense decreased $231,000, or 19%, because of the
repurchase by the Company of $16.7 million of the outstanding
Convertible Subordinated Notes in October 1997. The lower interest
expense that resulted from the lower amount of Convertible Subordinated
Notes outstanding was partially offset by increased interest expense on
the increased bank line of credit balance outstanding for the first
quarter of 1998.
<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceedings
Incorporated herein by reference is the discussion of litigation
set forth in Part I, Item 1, Notes to the Financial Statements - Note
5. Contingencies of this Form 10-Q.
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
3.1* Certificate of Incorporation, as amended.
3.2### Certificate of Amendment of Certificate of Incorporation
of Box Energy Corporation.
3.3++ By-Laws as amended.
4.1* Form of Indenture Box Energy Corporation to United
States Trust Company of New York, Trustee, dated
December 1, 1992, 8 1/4% Convertible Subordinated Notes
due December 1, 2002.
10.1* Amended and Restated Certificate and Articles of Limited
Partnership of OKC Limited Partnership.
10.2* Restatement and Amendment of Gas Purchase Contract dated
July 15, 1982, as amended October 5, 1982, December 21,
1982, and December 26, 1984.
10.3* Assignment of Lease, dated May 26, 1977.
10.4* Oil and Gas Lease of Submerged Lands under the Outer
Continental Shelf Lands Act dated July 1, 1967, covering
all of Block 89, South Pass Area and East Addition by
the United States of America, as Lessor, dated July 1,
1967, said lease having been assigned to Box Energy
Corporation as of April 15, 1992.
10.5* Oil and Gas Lease of Submerged Lands under the Outer
Continental Shelf Lands Act dated July 1, 1967, covering
all of Block 86, South Pass Area and East Addition by
the United States of America, as Lessor, dated July 1,
1983, said lease having been assigned to Box Energy
Corporation as of April 15, 1992.
10.6* Oil and Gas Lease of Submerged Lands under the Outer
Continental Shelf Lands Act dated July 1, 1967, covering
all of Block 87, South Pass Area and East Addition by
the United States of America, as Lessor, dated September
1, 1985, said lease having been assigned to Box Energy
Corporation as of April 15, 1992.
10.7* Farmout Agreement with Aminoil USA, Inc., effective May
1, 1977, dated May 9, 1977.
10.8* Transportation Agreement with CKB Petroleum, Inc. dated
March 1, 1985, as amended on April 19, 1989.
10.9* Agreement of Compromise and Amendment to Farmout
Agreement dated July 3, 1989.
10.10* Settlement Agreement with Texas Eastern Transmission
Corporation dated November 14, 1990.
10.11* Guarantee of Panhandle Eastern Corporation dated
November 21, 1990.
10.12* Bill of Sale and Assumption of Obligations from OKC
Limited Partnership dated April 15, 1992.
10.13* Asset Purchase Agreement dated April 15, 1992.
10.14* 1992 Incentive Stock Option Plan of Box Energy
Corporation.
10.15** Pension Plan of Box Energy Corporation, effective April
16, 1992.
10.16# First Amendment to the Pension Plan of Box Energy
Corporation dated December 16, 1993.
10.17## Second Amendment to the Pension Plan of Box Energy
Corporation dated December 31, 1994.
10.18+ Form of Executive Severance Agreement dated as of
December 12, 1995 by and between Box Energy Corporation
and key employees.
10.19+ Form of Letter Agreement regarding severance benefits
dated as of December 12, 1995 by and between Box Energy
Corporation and employees not covered by Executive
Severance Agreements.
10.20*** Amended and Restated Promissory Note between Box Energy
Corporation and Box Brothers Holding Company.
10.21*** Amended and Restated Pledge Agreement between Box Energy
Corporation and Box Brothers Holding Company.
10.22*** Agreement by and between Box Energy Corporation and
James A. Watt.
10.23### Box Energy Corporation Severance Plan.
10.24### Box Energy Corporation 1997 Stock Option Plan.
10.25### Box Energy Corporation Non-Employee Director Stock
Purchase Plan.
10.26### Form of Executive Employment Agreement, effective August
29, 1997, by and between Box Energy Corporation and two
executive officers.
11.1 Statement regarding Computation of Income per share.
27 Financial Data Schedule
(b) No forms 8-K were filed during the quarter ended March 31, 1998.
- ----------
* Incorporated by reference to the Company's Registration
Statement on Form S-2 (file number 33-52156) filed with the
Commission and effective on December 1, 1992.
** Incorporated by reference to the Company's Form 10-K (file
number 0-19967) for the fiscal year ended December 31, 1992
filed with the Commission and effective on or about March 30,
1993.
# Incorporated by reference to the Company's Form 10-K (file
number 0-19967) for the fiscal year ended December 31, 1993
filed with the Commission and effective on or about March 30,
1994.
## Incorporated by reference to the Company's Form 10-K (file
number 0-19967) for the fiscal year ended December 31, 1994
filed with the Commission and effective on or about March 30,
1995.
+ Incorporated by reference to the Company's Form 10-K (file
number 0-19967) for the fiscal year ended December 31, 1995
filed with the Commission and effective on or about April 1,
1996.
++ Incorporated by reference to the Company's Form 10-K (file
number 1-11516) for the fiscal year ended December 31, 1996
filed with the Commission and effective on or about March 31,
1997.
*** Incorporated by reference to the Company's Form 10-Q (file
number 1-11516) for the fiscal quarter ended June 30, 1997
filed with the Commission and effective on or about August 12,
1997.
### Incorporated by reference to the Company's Form 10-K (file
number 1-11516) for the fiscal year ended December 31, 1997
filed with the Commission and effective on or about March 30,
1998.
<PAGE>
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 thereunto duly authorized.
REMINGTON OIL AND GAS CORPORATION
Date: May 14, 1998 By: (James A. Watt)
------------------- --------------------------------
James A. Watt
President and Chief Executive Officer
Date: May 14, 1998 By: (J. Burke Asher)
------------------- --------------------------------
J. Burke Asher
Vice President/Finance
Remington Oil and Gas Corporation
Computation of Earnings per Share
Exhibit 11.1
(In thousands, except per share amounts)
For the Three Months Ended
March 31,
1997 1996
--------------------------
Net income (loss) available for basic
income per share $ (1,995) $ 1,807
Interest expense on the Notes
(net of tax) (1) - -
--------------------------
Net income (loss) available for diluted
income per share $ (1,995) $ 1,807
==========================
Basic income (loss) per share $ (0.10) $ 0.09
==========================
Diluted income (loss) per share $ (0.10) $ 0.09
==========================
Weighted average
Class A Stock 3,222 3,250
Class B Stock 17,129 17,553
--------------------------
Total common shares for basic income
(loss) per share 20,351 20,803
--------------------------
Dilutive stock options outstanding
(treasury stock method) (1) - -
Shares assumed issued by conversion of
the Notes (1) - -
--------------------------
Total common shares for diluted income
(loss) per share 20,351 20,803
==========================
(1) Non dilutive.
Potential increase to net income for
diluted income per share
Interest expense on Notes (net of tax) $ 514 $ 728
Potential issues of common stock for
diluted income per share
Weighted average stock options granted 562 310
Weighted average shares issued assuming
conversion of Notes 3,488 5,007
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM REMINGTON
OIL AND GAS CORPORATION'S FORM 10-Q FOR THE QUARTERLY PERIOD ENDED MARCH 31,
1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000874992
<NAME> REMINGTON OIL AND GAS CORPORATION
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 3253
<SECURITIES> 0
<RECEIVABLES> 4992
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 15660
<PP&E> 231554
<DEPRECIATION> 150288
<TOTAL-ASSETS> 97800
<CURRENT-LIABILITIES> 16897
<BONDS> 38371
0
0
<COMMON> 20809
<OTHER-SE> 21813
<TOTAL-LIABILITY-AND-EQUITY> 97800
<SALES> 11655
<TOTAL-REVENUES> 12507
<CGS> 12236
<TOTAL-COSTS> 13507
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 995
<INCOME-PRETAX> (1995)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1995)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1995)
<EPS-PRIMARY> (.10)
<EPS-DILUTED> (.10)
</TABLE>
