UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended June 30, 2000
Commission File No. 33-26097-08
PARKER & PARSLEY 90-B CONV., L.P.
(Exact name of Registrant as specified in its charter)
Delaware 75-2329284
----------------------------------------- ---------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1400 Williams Square West, 5205 N. O'Connor Blvd., Irving, Texas 75039
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(Address of principal executive offices) (Zip code)
Registrant's Telephone Number, including area code : (972) 444-9001
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 / /
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PARKER & PARSLEY 90-B CONV., L.P.
TABLE OF CONTENTS
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets as of June 30, 2000 and
December 31, 1999....................................... 3
Statements of Operations for the three and six
months ended June 30, 2000 and 1999...................... 4
Statement of Partners' Capital for the six months
ended June 30, 2000...................................... 5
Statements of Cash Flows for the six months ended
June 30, 2000 and 1999................................... 6
Notes to Financial Statements.............................. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations...................... 7
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K........................... 10
27.1 Financial Data Schedule
Signatures................................................. 11
2
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PARKER & PARSLEY 90-B CONV., L.P.
(A Delaware Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
<TABLE>
BALANCE SHEETS
June 30, December 31,
2000 1999
------------ -----------
(Unaudited)
ASSETS
<S> <C> <C>
Current assets:
Cash $ 140,791 $ 132,031
Accounts receivable - oil and gas sales 169,409 143,411
---------- ----------
Total current assets 310,200 275,442
---------- ----------
Oil and gas properties - at cost, based on the
successful efforts accounting method 9,623,172 9,612,816
Accumulated depletion (7,991,561) (7,939,049)
---------- ----------
Net oil and gas properties 1,631,611 1,673,767
---------- ----------
$ 1,941,811 $ 1,949,209
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 37,325 $ 24,507
Partners' capital:
Managing general partner 19,043 19,246
Limited partners (11,897 interests) 1,885,443 1,905,456
---------- ----------
1,904,486 1,924,702
---------- ----------
$ 1,941,811 $ 1,949,209
========== ==========
</TABLE>
The financial information included as of June 30, 2000 has been prepared by
the managing general partner without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
3
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PARKER & PARSLEY 90-B CONV., L.P.
(A Delaware Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
Three months ended Six months ended
June 30, June 30,
--------------------- ---------------------
2000 1999 2000 1999
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Revenues:
Oil and gas $ 356,486 $ 196,244 $ 687,189 $ 349,651
Interest 2,684 960 4,777 1,899
Gain on disposition of assets - - 2,023 -
-------- -------- -------- ------
359,170 197,204 693,989 351,550
-------- -------- -------- --------
Costs and expenses:
Oil and gas production 143,700 115,052 277,308 236,655
General and administrative 11,592 6,427 21,724 12,245
Depletion 25,752 29,386 52,512 90,929
-------- -------- -------- --------
181,044 150,865 351,544 339,829
-------- -------- -------- --------
Net income $ 178,126 $ 46,339 $ 342,445 $ 11,721
======== ======== ======== ========
Allocation of net income:
Managing general partner $ 1,781 $ 463 $ 3,424 $ 117
======== ======== ======== ========
Limited partners $ 176,345 $ 45,876 $ 339,021 $ 11,604
======== ======== ======== ========
Net income per limited
partnership interest $ 14.83 $ 3.86 $ 28.50 $ .98
======== ======== ======== ========
</TABLE>
The financial information included herein has been prepared by
the managing general partner without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
4
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PARKER & PARSLEY 90-B CONV., L.P.
(A Delaware Limited Partnership)
STATEMENT OF PARTNERS' CAPITAL
(Unaudited)
<TABLE>
Managing
general Limited
partner partners Total
---------- ---------- ----------
<S> <C> <C> <C>
Balance at January 1, 2000 $ 19,246 $1,905,456 $1,924,702
Distributions (3,627) (359,034) (362,661)
Net income 3,424 339,021 342,445
--------- --------- ---------
Balance at June 30, 2000 $ 19,043 $1,885,443 $1,904,486
========= ========= =========
</TABLE>
The financial information included herein has been prepared by
the managing general partner without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
5
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PARKER & PARSLEY 90-B CONV., L.P.
(A Delaware Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
Six months ended
June 30,
----------------------
2000 1999
--------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 342,445 $ 11,721
Adjustments to reconcile net income to net
cash provided by operating activities:
Depletion 52,512 90,929
Gain on disposition of assets (2,023) -
Changes in assets and liabilities:
Accounts receivable (25,998) (41,986)
Accounts payable 12,818 12,495
-------- --------
Net cash provided by operating activities 379,754 73,159
-------- --------
Cash flows from investing activities:
Additions to oil and gas properties (10,356) (5,828)
Proceeds from asset dispositions 2,023 -
-------- --------
Net cash used in investing activities (8,333) (5,828)
-------- --------
Cash flows used in financing activities:
Cash distributions to partners (362,661) (46,886)
-------- --------
Net increase in cash equivalents 8,760 20,445
Cash at beginning of period 132,031 76,330
-------- --------
Cash at end of period $ 140,791 $ 96,775
======== ========
</TABLE>
The financial information included herein has been prepared by
the managing general partner without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
6
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PARKER & PARSLEY 90-B CONV., L.P.
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
June 30, 2000
(Unaudited)
Note 1. Organization and nature of operations
Parker & Parsley 90-B Conv., L.P. (the "Partnership") 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 Partnership engages in oil and gas development and production in Texas and
is not involved in any industry segment other than oil and gas.
Note 2. Basis of presentation
In the opinion of management, the unaudited financial statements of the
Partnership as of June 30, 2000 and for the three and six months ended June 30,
2000 and 1999 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. These interim results are not necessarily
indicative of results for a full year. Certain reclassifications may have been
made to the June 30, 1999 financial statements to conform to the June 30, 2000
financial statement presentations.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted in this Form 10-Q pursuant to the rules and
regulations of the Securities and Exchange Commission. The financial statements
should be read in conjunction with the financial statements and the notes
thereto contained in the Partnership's Report on Form 10-K for the year ended
December 31, 1999, as filed with the Securities and Exchange Commission, a copy
of which is available upon request by writing to Rich Dealy, Vice President and
Chief Accounting Officer, 5205 North O'Connor Boulevard, 1400 Williams Square
West, Irving, Texas 75039-3746.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations (1)
Results of Operations
Six months ended June 30, 2000 compared with six months ended June 30, 1999
Revenues:
The Partnership's oil and gas revenues increased 97% to $687,189 for the six
months ended June 30, 2000 as compared to $349,651 for the same period in 1999.
The increase in revenues resulted from higher average prices received, offset by
a decrease in production. For the six months ended June 30, 2000, 17,958 barrels
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of oil, 8,604 barrels of natural gas liquids ("NGLs") and 33,016 mcf of gas were
sold, or 32,065 barrel of oil equivalents ("BOEs"). For the six months ended
June 30, 1999, 18,107 barrels of oil, 8,670 barrel of NGLs and 36,322 mcf of gas
were sold, or 32,831 BOEs.
The average price received per barrel of oil increased $14.50, or 110%, from
$13.22 for the six months ended June 30, 1999 to $27.72 for the same period in
2000. The average price received per barrel of NGLs increased $7.19, or 106%,
from $6.81 during the six months ended June 30, 1999 to $14.00 for the same
period in 2000. The average price received per mcf of gas increased 48% from
$1.41 for the six months ended June 30, 1999 to $2.08 for the same period in
2000. 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 Partnership may therefore sell its future oil and gas
production at average prices lower or higher than that received during the six
months ended June 30, 2000.
The volatility of commodity prices has had, and continues to have, a significant
impact on the Partnership's revenues and operating cash flow and could result in
additional decreases to the carrying value of the Partnership's oil and gas
properties.
A gain on disposition of assets of $2,023 was recognized during the six months
ended June 30, 2000 from the sale of equipment on one fully depleted well.
Costs and Expenses:
Total costs and expenses increased to $351,544 for the six months ended June 30,
2000 as compared to $339,829 for the same period in 1999, an increase of
$11,715, or 3%. This increase was due to increases in production costs and
general and administrative expenses ("G&A"), offset by a decline in depletion.
Production costs were $277,308 for the six months ended June 30, 2000 and
$236,655 for the same period in 1999, resulting in a $40,653 increase, or 17%.
This increase was the result of higher production taxes due to higher oil and
gas prices and additional well maintenance costs incurred to stimulate well
production.
G&A's components are independent accounting and engineering fees and managing
general partner personnel and operating costs. During this period, G&A
increased, in aggregate, 77% from $12,245 for the six months ended June 30, 1999
to $21,724 for the same period in 2000 primarily due to a higher allocation of
the managing general partner's G&A being allocated (limited to 3% of oil and gas
revenues) as a result of increased oil and gas revenues.
Depletion was $52,512 for the six months ended June 30, 2000 compared to $90,929
for the same period in 1999, a decrease of $38,417, or 42%. This decrease was
due to an increase in proved reserves during the period ended June 30, 2000 due
to higher commodity prices, a decline in oil production of 149 barrels for the
six months ended June 30, 2000 compared to the same period in 1999 and a
reduction in the Partnership's net depletable basis from charges taken in
accordance with Statement of Financial Accounting Standards No. 121, "Accounting
for the Impairment of Long- Lived Assets and for Long-Lived Assets to be
Disposed Of" ("SFAS 121") during the fourth quarter of 1999.
8
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Three months ended June 30, 2000 compared with three months ended June 30, 1999
Revenues:
The Partnership's oil and gas revenues increased 82% to $356,486 for the three
months ended June 30, 2000 as compared to $196,244 for the same period in 1999.
The increase in revenues resulted from higher average prices received, offset by
a decrease in production. For the three months ended June 30, 2000, 8,968
barrels of oil, 4,625 barrels of NGLs and 17,395 mcf of gas were sold, or 16,492
BOEs. For the three months ended June 30, 1999, 8,675 barrels of oil, 4,896
barrels of NGLs and 18,753 mcf of gas were sold, or 16,697 BOEs.
The average price received per barrel of oil increased $12.94, or 87%, from
$14.81 for the three months ended June 30, 1999 to $27.75 for the same period in
2000. The average price received per barrel of NGLs increased $6.20, or 78%,
from $7.90 during the three months ended June 30, 1999 to $14.10 for the same
period in 2000. The average price received per mcf of gas increased 57% from
$1.55 during the three months ended June 30, 1999 to $2.44 for the same period
in 2000.
Costs and Expenses:
Total costs and expenses increased to $181,044 for the three months ended June
30, 2000 as compared to $150,865 for the same period in 1999, an increase of
$30,179, or 20%. This increase was due to increases in production costs and G&A,
offset by a decline in depletion.
Production costs were $143,700 for the three months ended June 30, 2000 and
$115,052 for the same period in 1999, resulting in a $28,648 increase, or 25%.
The increase was the result of additional well maintenance costs and workover
expenses incurred to stimulate well production and higher production taxes due
to higher oil and gas prices.
During this period, G&A increased, in aggregate, 80% from $6,427 for the three
months ended June 30, 1999 to $11,592 for the same period in 2000 principally
due to a higher allocation of the managing general partner's G&A being allocated
(limited to 3% of oil and gas revenues) as a result of increased oil and gas
revenues.
Depletion was $25,752 for the three months ended June 30, 2000 compared to
$29,386 for the same period in 1999, a decrease of $3,634, or 12%. This decrease
was due to an increase in proved reserves during the period ended June 30, 2000
as a result of higher commodity prices and a reduction in the Partnership's net
depletable basis from charges taken in accordance with SFAS 121 during the
fourth quarter of 1999, offset by an increase in oil production of 293 barrels
for the three months ended June 30, 2000 compared to the same period in 1999.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities increased $306,595 during the six
months ended June 30, 2000 from the same period ended June 30, 1999. This
9
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increase resulted from an increase of $356,404 in oil and gas sales receipts,
offset by an increase in operating costs paid of $42,652 and G&A expenses paid
of $7,157.
Net Cash Used in Investing Activities
The Partnership's principal investing activities for the six months ended June
30, 2000 and 1999 included expenditures related to equipment upgrades on various
oil and gas properties.
Proceeds from asset dispositions of $2,023 received during the six months ended
June 30, 2000 were derived from the sale of equipment on one fully depleted
well.
Net Cash Used in Financing Activities
For the six months ended June 30, 2000, cash distributions to the partners were
$362,661, of which $3,627 was distributed to the managing general partner and
$359,034 to the limited partners. For the same period ended June 30, 1999, cash
distributions to the partners were $46,886, of which $468 was distributed to the
managing general partner and $46,418 to the limited partners.
---------------
(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.
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27.1 Financial Data Schedule
(b) Form 8-K - none
10
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PARKER & PARSLEY 90-B 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-B CONV., L.P.
By: Pioneer Natural Resources USA, Inc.,
Managing General Partner
Dated: August 11, 2000 By: /s/ Rich Dealy
-------------------------------
Rich Dealy, Vice President and
Chief Accounting Officer
11
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