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UNITED STATES
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): FEBRUARY 24, 1998
BELCO OIL & GAS CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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NEVADA 011-14246 13-3869719
(STATE OR OTHER JURISDICTION OF (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
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767 FIFTH AVENUE, 46TH FLOOR
NEW YORK, NEW YORK 10153
(ADDRESS OF PRINCIPAL
EXECUTIVE OFFICES
AND ZIP CODE)
(212) 644-2200
(REGISTRANT'S TELEPHONE NUMBER,
INCLUDING AREA CODE)
__________________________________
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ITEM 5. OTHER EVENTS
On February 24, 1998, Belco Oil & Gas Corp. reported earnings for the
fourth quarter and year ended December 31, 1997. Fourth quarter oil and gas
revenues increased 51% to $41.4 million from $27.4 million for the comparable
period in 1996. Pro forma net income for the quarter increased 32% to $12.3
million or $0.39 per diluted common share, (including commodity price risk
management activities and excluding the previously announced non-cash full cost
ceiling test provision principally related to the acquisition of Coda Energy,
Inc.), compared to $9.3 million or $0.30 per diluted common share in the prior
year. The Company generated $29.2 million in discretionary cash flow or $0.96
per share in the fourth quarter of 1997 compared to $30.7 million or $1.02 per
share in 1996.
For the year ended December 31, 1997, total revenues increased 9% to
$126.8 million compared to $116.4 million for 1996. Net income for 1997 was
$40.6 million or $1.29 per diluted common share, excluding the effects of the
fourth quarter non-cash full cost ceiling test provision. For 1996, pro forma
net income was $42.6 million or $1.42 per diluted common share excluding a
one-time non-cash deferred tax charge of $30.1 million recognized as a result
of the combination consummated on March 29, 1996 in connection with the
Company's Initial Public Offering. The decrease in net income, exclusive of
the non-cash full cost ceiling test provision, is primarily due to additional
operating expenses, including a higher DD&A rate, offset in part by higher
overall revenues. After giving effect to the previously announced $150 million
non-cash full cost ceiling test provision ($97.5 million after tax), primarily
related to the acquisition of Coda in November, 1997 and the related SFAS 109
and purchase accounting compliance requirements, the Company incurred a net
loss of $56.9 million, or $(1.80) per diluted common share.
Discretionary cash flow for 1997 totaled $106.5 million or $3.41 per
share compared to $108.7 million or $3.63 per share realized in 1996. Weighted
average shares outstanding at year-end 1997 and 1996 were 31.6 million and 30.0
million, respectively. Oil production for 1997 increased by 63% over 1996 to
1,294,000 barrels, while gas production declined 3% to 49.7 BCF compared to
1996.
In addition to significantly lengthening Belco's reserve life and
balancing the Company's natural gas/oil reserve mix, the acquisition of Coda
positioned Belco as a company with four distinct core areas in the Rocky
Mountain region, Permian Basin, Mid-Continent region and the Austin Chalk
Trend. Year-end estimated proved reserves of 604 BCFE were divided
approximately 22% Rocky Mountain region, 29% Permian Basin, 29% Mid-Continent
region, 18% Austin Chalk Trend and 2% Other. The current 1998 capital
expenditure budget is estimated to total approximately $170 million (including
$10 million for acreage and seismic) which will be spent primarily on drilling
and acquisitions in the Company's four core areas.
Summary Financial Information for the quarter and year ended December
31, 1997 and 1996 is attached hereto as Exhibit 99.1 and incorporated herein by
reference.
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
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EXHIBIT DOCUMENT
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99.1 Belco Oil & Gas Corp., Press Release dated February 24, 1998 including Summary
Financial Information for the Quarter and Year ended December 31, 1997 and
1996.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
BELCO OIL & GAS CORP.
Date: February 24, 1998
By: \s\ Robert A. Belfer
----------------------------------
Robert A. Belfer,
Chairman of the Board
and Chief Executive Officer
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EXHIBIT INDEX
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Sequential
Exhibit No. Description of Exhibit Page No.
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99.1 Belco Oil & Gas Corp. Press Release dated 5
February 24, 1998
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EXHIBIT 99.1
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[BELCO LOGO]
NEWS RELEASE
- ------------
FROM: BELCO OIL & GAS CORP.
767 FIFTH AVENUE - 46TH FLOOR
NEW YORK, NY 10153
WWW.BELCOOIL-GAS.COM
CONTACT: DOMINICK J. GOLIO, CHIEF FINANCIAL OFFICER -
(212) 508-9513
FOR IMMEDIATE RELEASE
BELCO OIL & GAS CORP. ANNOUNCES FOURTH QUARTER AND 1997 RESULTS
Tuesday, February 24, 1998
New York, New York - Belco Oil & Gas Corp. (NYSE:BOG) announced today
its financial results for the fourth quarter and calendar year 1997. Fourth
quarter oil and gas revenues increased 51% to $41.4 million from $27.4 million
for the comparable period in 1996. Pro forma net income for the quarter
increased 32% to $12.3 million or $0.39 per diluted common share, (including
commodity price risk management activities and excluding the previously
announced non-cash full cost ceiling test provision principally related to the
acquisition of Coda Energy, Inc.), compared to $9.6 million or $0.30 per
diluted common share in the prior year. The Company generated $29.5 million in
discretionary cash flow or $0.93 per share in the fourth quarter of 1997
compared to $30.7 million or $1.02 per share in 1996.
For the year ended December 31, 1997, total revenues increased 9% to
$126.8 million compared to $116.4 million for 1996. Net income for 1997 was
$40.6 million or $1.29 per diluted common share, excluding the effects of the
fourth quarter non-cash full cost ceiling test provision. For 1996, pro forma
net income was $42.6 million or $1.42 per diluted common share excluding a
one-time non-cash deferred tax charge of $30.1 million recognized as a result
of the combination consummated on March 29, 1996 in connection with the
Company's Initial Public Offering. The decrease in net income, exclusive of
the non-cash full cost ceiling test provision, is primarily due to additional
operating expenses, including a higher DD&A rate, offset in part by higher
overall revenues. After giving effect to the previously announced $150 million
non-cash full cost ceiling test provision ($97.5 million after tax), primarily
related to the acquisition of Coda in November, 1997 and the related SFAS 109
and purchase accounting compliance requirements, the Company incurred a net
loss of $56.9 million, or $(1.80) per diluted common share.
Discretionary cash flow for 1997 totaled $106.0 million or $3.36 per
share compared to $108.7 million or $3.63 per share realized in 1996. Weighted
average shares outstanding at year-end 1997 and 1996 were 31.6 million and 30.0
million, respectively. Oil production for 1997
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increased by 63% over 1996 to 1,295,000 barrels, while gas production declined
3% to 49.7 BCF compared to 1996.
BELCO ENTERS 1998 "BALANCED FOR GROWTH" WITH $170 MILLION BUDGET
In addition to significantly lengthening Belco's reserve life and
balancing the Company's natural gas/oil reserve mix, the acquisition of Coda
positioned Belco as a company with four distinct core areas in the Rocky
Mountain region, Permian Basin, Mid-Continent region and the Austin Chalk
Trend. Year-end estimated proved reserves of 604 BCFE were divided
approximately 22% Rocky Mountain region, 29% Permian Basin, 29% Mid-Continent
region, 18% Austin Chalk Trend and 2% Other. The current 1998 capital
expenditure budget is estimated to total approximately $170 million (including
$10 million for acreage and seismic) which will be spent primarily on drilling
and acquisitions in the Company's four core areas.
Belco Oil & Gas Corp. is an independent energy company engaged in the
exploration, development, acquisition and production of natural gas and oil.
This press release includes forward looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Although BOG believes that its expectations are based on
reasonable assumptions, it can give no assurance that its goals will be
achieved. Important factors that could cause actual results to differ
materially from those in the forward looking statements herein include the
timing and extent of changes in commodity prices for oil and gas, the need to
develop and replace reserves, environmental risks, drilling and operating
risks, risks related to exploration and development, uncertainties about the
estimates of reserves, competition, government regulation and the ability of
the Company to meet its stated business goals.
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BELCO OIL & GAS CORP.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
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THREE MONTHS ENDED
DECEMBER 31, YEAR ENDED
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1997 1996 1997 1996
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REVENUES:
Oil and gas sales $40,252 $35,780 $129,994 $119,710
Commodity Price Risk Management Activities
Realized Settlements (5,164) (4,180) (13,060) (1,767)
Mark-to-Market (b) (Non-Cash) 6,359 (4,200) 6,581 (4,200)
Interest and other 920 804 3,246 2,653
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Total revenues 42,367 28,204 126,760 116,396
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COSTS AND EXPENSES:
Oil and gas operating expenses 6,102 2,021 12,758 7,847
Depreciation, depletion and amortization 14,494 11,013 46,684 40,904
General and administrative 1,437 615 3,913 3,059
Interest expenses 1,668 0 1,668 0
Impairment of oil and gas properties 150,000 0 150,000
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Total costs and expenses 173,701 13,649 215,023 51,810
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INCOME (LOSS) BEFORE INCOME TAXES (131,334) 14,555 (88,263) 64,586
PROVISION BENEFIT FOR INCOME TAXES (46,091) 5,261 (31,355) 46,404 (a)
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NET INCOME (LOSS) $ (85,243) $ 9,294 $(56,908) $18,182 (a)
========= ======= ======== =======
PRO FORMA NET INCOME
Income (loss) before income taxes $(131,334) $14,555 $(88,263) $64,586
Pro forma provision (benefit) for income (46,091) 4,939 (31,355) 21,950
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Pro forma net income (loss) $ (85,243) $ 9,616 $(56,908) $42,636
========= ======= ======== =======
PRO FORMA NET INCOME (LOSS) PER COMMON SHARE $ (2.70) $ 0.30 $ (1.80) $ 1.42
========= ======= ======== =======
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 31,582 31,500 31,582 29,986
========= ======= ======== =======
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(a) Includes a one-time non-cash deferred tax charge of $30.1 million
recognized as a result of the Combination consummated on March 29,
1996 in connection with the Company's Initial Public Offering and
discussed in the Belco Oil & Gas Corp. Prospectus dated March 25,
1996. Historical net income per share, including the deferred tax
charge, was $0.61 for the year ended December 31, 1996. The pro forma
amounts present the Company as if a taxable corporation for all
periods and is based on the average number of shares outstanding
during the period assuming the Combination.
(b) Includes cash premiums received and non-cash accruals.
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The following table sets forth certain operations data of the Company
for the periods presented:
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THREE MONTHS ENDED YEARS ENDED
DECEMBER 31, DECEMBER 31,
1997 1996 1997 1996
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Oil and Gas Sales(1) $41,447 $27,400 $123,515 $113,743
Weighted Average Sales Prices (Unhedged):
Oil (per Bbl) $ 18.48 $ 23.39 $ 19.28 $ 21.30
Gas (per Mcf) 2.32 2.39 2.11 2.00
Net Production Data:
Oil (MBbl) 578 219 1,295 794
Gas (MMcf) 12,737 12,037 49,710 51,289
Gas equivalent (Mmcfe) 16,210 13,351 57,479 56,053
Data per Mcfe:
Oil and gas sales revenues (Unhedged) $ 2.48 $ 2.68 $ 2.26 $ 2.14
Commodity Price Risk Management Activities -
Realized Settlements (0.32) (0.31) (0.23) 0.06
Mark-to-market 0.39 (0.31) 0.11 (0.17)
Oil and gas operating expenses (0.38) (0.14) (0.22) (0.14)
General and administrative (0.09) (0.06) (0.07) (0.06)
Depreciation, depletion and amortization (0.89) (0.82) (0.81) (0.73)
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Pre-tax operating profit(2) $ 1.19 $ 1.04 $ 1.04 $ 1.10
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Gross cash margin $ 1.69 $ 2.17 $ 1.74 $ 2.00
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(1) Includes net results of commodity price risk management activities.
(2) Excludes interest income and interest expense.
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