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 March 31, 1996
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 No. 33-26097-10
PARKER & PARSLEY 90-C CONV., L.P.
(Exact name of Registrant as specified in its charter)
Delaware 75-2347264
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
303 West Wall, Suite 101, Midland, Texas 79701
(Address of principal executive offices) (Zip code)
Registrant's Telephone Number, including area code : (915) 683-4768
Not applicable
(Former name, former address and former fiscal year,
if changed since last report)
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 / /
Page 1 of 10 pages.
-There are no exhibits-
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PARKER & PARSLEY 90-C CONV., L.P.
(A Delaware Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
BALANCE SHEETS
March 31, December 31,
1996 1995
----------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including interest
bearing deposits of $66,415 at March 31
and $81,814 at December 31 $ 66,709 $ 82,151
Accounts receivable - oil and gas sales 80,104 69,436
---------- ----------
Total current assets 146,813 151,587
Oil and gas properties - at cost, based on the
successful efforts accounting method 5,830,586 5,829,695
Accumulated depletion (4,286,059) (4,252,391)
---------- ----------
Net oil and gas properties 1,544,527 1,577,304
---------- ----------
$ 1,691,340 $ 1,728,891
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 22,608 $ 49,135
Partners' capital:
Limited partners (7,531 interests) 1,652,074 1,662,989
Managing general partner 16,658 16,767
---------- ----------
1,668,732 1,679,756
---------- ----------
$ 1,691,340 $ 1,728,891
========== ==========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
PARKER & PARSLEY 90-C CONV., L.P.
(A Delaware Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended
March 31,
1996 1995
---------- ----------
Revenues:
Oil and gas sales $ 190,916 $ 201,581
Interest income 983 994
--------- ---------
Total revenues 191,899 202,575
Costs and expenses:
Production costs 83,533 86,313
General and administrative expenses 5,727 6,755
Depletion 33,668 37,597
Amortization of organization costs - 794
--------- ---------
Total costs and expenses 122,928 131,459
--------- ---------
Net income $ 68,971 $ 71,116
========= =========
Allocation of net income:
Managing general partner $ 690 $ 719
========= =========
Limited partners $ 68,281 $ 70,397
========= =========
Net income per limited partnership interest $ 9.07 $ 9.35
========= =========
Distributions per limited partnership interest $ 10.52 $ 12.86
========= =========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
PARKER & PARSLEY 90-C CONV., L.P.
(A Delaware Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL
(Unaudited)
Managing
general Limited
partner partners Total
----------- ----------- -----------
Balance at January 1, 1995 $ 18,549 $ 1,842,493 $ 1,861,042
Distributions (979) (96,825) (97,804)
Net income 719 70,397 71,116
---------- ---------- ----------
Balance at March 31, 1995 $ 18,289 $ 1,816,065 $ 1,834,354
========== ========== ==========
Balance at January 1, 1996 $ 16,767 $ 1,662,989 $ 1,679,756
Distributions (799) (79,196) (79,995)
Net income 690 68,281 68,971
---------- ---------- ----------
Balance at March 31, 1996 $ 16,658 $ 1,652,074 $ 1,668,732
========== ========== ==========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
PARKER & PARSLEY 90-C CONV., L.P.
(A Delaware Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended
March 31,
1996 1995
---------- ----------
Cash flows from operating activities:
Net income $ 68,971 $ 71,116
Adjustments to reconcile net income to net
cash provided by operating activities:
Depletion and amortization 33,668 38,391
Changes in assets and liabilities:
Increase in accounts receivable (10,668) (4,126)
Increase (decrease) in accounts payable (26,527) 3,706
--------- ---------
Net cash provided by operating activities 65,444 109,087
Cash flows from investing activities:
Additions to oil and gas properties (891) (2,738)
Cash flows from financing activities:
Cash distributions to partners (79,995) (97,804)
--------- ---------
Net increase (decrease) in cash and cash
equivalents (15,442) 8,545
Cash and cash equivalents at beginning of period 82,151 47,974
--------- ---------
Cash and cash equivalents at end of period $ 66,709 $ 56,519
========= =========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
PARKER & PARSLEY 90-C CONV., L.P.
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
March 31, 1996
(Unaudited)
NOTE 1.
Parker & Parsley 90-C Conv., L.P. (the "Registrant") was organized as a general
partnership in 1990 under the laws of the State of Texas and was converted to a
Delaware limited partnership on August 1, 1991.
The Registrant engages primarily in oil and gas development and production in
Texas and is not involved in any industry segment other than oil and gas.
NOTE 2.
In the opinion of management, the unaudited financial statements as of March 31,
1996 of the Registrant include all adjustments and accruals consisting only of
normal recurring accrual adjustments which are necessary for a fair presentation
of the results for the interim period. However, these interim results are not
necessarily indicative of results for a full year.
The financial statements should be read in conjunction with the financial
statements and the notes thereto contained in the Registrant's Report on Form
10-K for the year ended December 31, 1995, as filed with the Securities and
Exchange Commission, a copy of which is available upon request by writing to
Steven L. Beal, Senior Vice President, 303 West Wall, Suite 101, Midland, Texas
79701.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations(1)
The Registrant was formed December 28, 1990. On January 1, 1995, Parker &
Parsley Development L.P. ("PPDLP"), a Texas limited partnership, became the sole
managing general partner of the Registrant, by acquiring the rights and assuming
the obligations of Parker & Parsley Development Company ("PPDC"). PPDLP acquired
PPDC's rights and obligations as managing general partner of the Registrant in
connection with the merger of PPDC, P&P Producing, Inc. and Spraberry
Development Corporation into MidPar L.P., which survived the merger with a
change of name to PPDLP. PPDLP has the power and authority to manage, control
and administer all Registrant affairs. The partners contributed $7,531,000
representing 7,531 interests ($1,000 per interest) sold to a total of 517
partners. The Registrant converted to a Delaware limited partnership on August
1, 1991. The managing general partner received an opinion of legal counsel to
the effect that such conversion would not result in material adverse tax
consequences to the Registrant.
6
<PAGE>
Since its formation, the Registrant has invested $5,948,152 in various prospects
that were drilled in Texas. One well was plugged and abandoned in 1995 due to
uneconomical operations. At March 31, 1996, the Registrant had 43 producing oil
and gas wells.
Results of Operations
Revenues:
The Registrant's oil and gas revenues decreased to $190,916 from $201,581 for
the three months ended March 31, 1996 and 1995, respectively, a decrease of 5%.
The decrease in revenues resulted from a 13% decline in barrels of oil produced
and sold and a 20% decline in mcf of gas produced and sold, offset by an 11%
increase in the average price received per barrel of oil and a 13% increase in
the average price received per mcf of gas. For the three months ended March 31,
1996, 7,904 barrels of oil were sold compared to 9,132 for the same period in
1995, a decrease of 1,228 barrels. For the three months ended March 31, 1996,
17,794 mcf of gas were sold compared to 22,236 for the same period in 1995, a
decrease 4,442 mcf. Due to the decline characteristics of the Registrant's oil
and gas properties, management expects a certain amount of decline in production
to continue in the future until the Registrant's economically recoverable
reserves are fully depleted.
The average price received per barrel of oil increased $1.88 from $17.22 for the
three months ended March 31, 1995 to $19.10 for the same period in 1996 while
the average price received per mcf of gas increased from $2.00 during the three
months ended March 31, 1995 to $2.25 in 1996. The market price for oil and gas
has been extremely volatile in the past decade, and management expects a certain
amount of volatility to continue in the foreseeable future. The Registrant may
therefore sell its future oil and gas production at average prices lower or
higher than that received during the three months ended March 31, 1996.
Costs and Expenses:
Total costs and expenses decreased to $122,928 for the three months ended March
31, 1996 as compared to $131,459 for the same period in 1995, a decrease of
$8,531, or 6%. This decrease was due to declines in production costs, general
and administrative expenses ("G&A"), depletion and amortization of organization
costs.
Production costs were $83,533 for the three months ended March 31, 1996 and
$86,313 for the same period in 1995, resulting in a decrease of $2,780, or 3%.
The decrease was due to declines in well repair and maintenance costs and lower
ad valorem taxes.
G&A's components are independent accounting and engineering fees, computer
services, postage and managing general partner personnel costs. During this
period, G&A decreased, in aggregate, 15% from $6,755 for the three months ended
March 31, 1995 to $5,727 for the same period in 1996. The Partnership agreement
limits G&A to 3% of gross oil and gas revenues.
7
<PAGE>
Depletion was $33,668 for the three months ended March 31, 1996 compared to
$37,597 for the same period in 1995. This represented a decrease in depletion of
$3,929, or 10%, primarily attributable to the adoption of the provisions of
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
effective for the fourth quarter of 1995 and the reduction of net depletable
basis resulting from the charge taken upon such adoption. Depletion was computed
property-by-property utilizing the unit-of-production method based upon the
dominant mineral produced, generally oil. Oil production decreased 1,228 barrels
for the three months ended March 31, 1996 from the same period in 1995, while
oil reserves of barrels were revised downward by 13,797 barrels, or 3%.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities decreased to $65,444 during the three
months ended March 31, 1996, a 40% decrease from the same period ended March 31,
1995. This decrease was due to a decline in oil and gas sales receipts and
increases in expenditures for production costs. The decline in oil and gas sales
receipts was due to a decline in barrels of oil and mcf of gas produced and
sold, offset by an increase in the average price received per barrel of oil and
mcf of gas. The increase in production cost expenditures was due to additional
well repair and maintenance costs.
Net Cash Used in Investing Activities
The Registrant's principal investing activities during the three months ended
March 31, 1996 were for repair and maintenance activity on various oil and gas
properties.
Net Cash Used in Financing Activities
Cash was sufficient for the three months ended March 31, 1996 to cover
distributions to the partners of $79,995 of which $79,196 was distributed to the
limited partners and $799 to the managing general partner. For the same period
ended March 31, 1995, cash was sufficient for distributions to the partners of
$97,804 of which $96,825 was distributed to the limited partners and $979 to the
managing general partner.
It is expected that future net cash provided by operating activities will be
sufficient for any capital expenditures and any distributions. As the production
from the properties declines, distributions are also expected to decrease.
- - ---------------
(1) "Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations" contains forward looking statements that involve
risks and uncertainties. Accordingly, no assurances can be given that the
actual events and results will not be materially different than the
anticipated results described in the forward looking statements.
8
<PAGE>
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - none
(b) Form 8-K - none
9
<PAGE>
PARKER & PARSLEY 90-C CONV., L.P.
(A Delaware Limited Partnership)
S I G N A T U R E S
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.
PARKER & PARSLEY 90-C CONV., L.P.
By: Parker & Parsley Development L.P.,
Managing General Partner
By: Parker & Parsley Petroleum USA, Inc.
("PPUSA"), General Partner
Dated: May 13, 1996 By: /s/ Steven L. Beal
--------------------------------------
Steven L. Beal, Senior Vice President
and Chief Financial Officer of PPUSA
10
<PAGE>
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 66,709
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<RECEIVABLES> 80,104
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<PP&E> 5,830,586
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0
0
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<OTHER-SE> 1,668,732
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<SALES> 190,916
<TOTAL-REVENUES> 191,899
<CGS> 0
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<INCOME-PRETAX> 68,971
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<INCOME-CONTINUING> 68,971
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<EXTRAORDINARY> 0
<CHANGES> 0
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