<PAGE> 1
================================================================================
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 JUNE 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-23166
[HUGOTON ENERGY CORPORATION LOGO]
(Exact name of registrant as specified in its charter)
KANSAS 48-1036256
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
301 N. MAIN, SUITE 1900, WICHITA, KANSAS 67202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (316) 262-1522
NONE
(Former name or former address, 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 [ ]
Indicate the number of shares of each of the issuer's classes of common stock,
as of the latest practicable date:
CLASS OUTSTANDING AS OF JULY 31, 1996
Common stock, no par value 19,697,036
================================================================================
<PAGE> 2
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION (UNAUDITED) PAGE
Item 1. Consolidated Financial Statements
Consolidated Statements of Operations for
the three months and six months ended
June 30, 1996 and 1995 3
Consolidated Balance Sheets at June 30,
1996 and December 31, 1995 4
Consolidated Statements of Cash Flows for
the six months ended June 30, 1996 and 1995 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7
PART II OTHER INFORMATION 11
SIGNATURE 12
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
HUGOTON ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
REVENUES: 1996 1995 1996 1995
--------------------------------- --------------------------------
<S> <C> <C> <C> <C>
Oil and Gas $ 15,899,855 $ 5,694,896 $ 31,473,730 $ 11,377,878
Gas plant 409,026 419,488 919,138 881,074
Gain on certain gas swap contracts -- -- 9,754 --
---------------------------------------------------------------------
TOTAL REVENUES 16,308,881 6,114,384 32,402,622 12,258,952
---------------------------------------------------------------------
EXPENSES:
Production
Lease operations 4,039,902 1,458,885 8,364,605 2,826,355
Production and severance tax 720,830 304,954 1,582,208 612,424
Gathering, transportation and other 684,260 76,715 847,356 182,652
Gas plant 353,502 272,681 692,500 504,149
Exploration 372,904 520,624 507,184 700,648
General and administrative 1,587,880 865,387 3,355,763 1,597,492
Depreciation, depletion, amortization 6,032,581 2,179,470 12,271,621 4,303,586
---------------------------------------------------------------------
TOTAL EXPENSES 13,791,859 5,678,716 27,621,237 10,727,306
---------------------------------------------------------------------
OPERATING INCOME 2,517,022 435,668 4,781,385 1,531,646
OTHER INCOME (EXPENSES):
Interest (1,452,752) (1,023,412) (2,980,717) (2,151,265)
Other 66,687 145,475 89,609 225,218
---------------------------------------------------------------------
TOTAL OTHER INCOME (EXPENSES) (1,386,065) (877,937) (2,891,108) (1,926,047)
---------------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES 1,130,957 (442,269) 1,890,277 (394,401)
Provision for income taxes 429,763 -- 718,305 --
---------------------------------------------------------------------
NET INCOME (LOSS) $ 701,194 $ (442,269) $ 1,171,972 $ (394,401)
=====================================================================
NET INCOME (LOSS) PER COMMON SHARE $ .04 $ (.04) $ .06 $ (.04)
=====================================================================
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 19,697,036 10,606,300 19,697,036 10,606,300
=====================================================================
</TABLE>
See accompanying notes.
3
<PAGE> 4
HUGOTON ENERGY CORPORATION
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1996 1995
---------------------------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash $ 5,521,633 $ 3,913,958
Accounts receivable 10,026,723 8,858,755
Other 729,197 1,096,593
---------------------------------
TOTAL CURRENT ASSETS 16,277,553 13,869,306
---------------------------------
PROPERTIES AND EQUIPMENT, AT COST (SUCCESSFUL EFFORTS METHOD)
Proved properties 238,808,589 232,173,312
Unproved properties 24,209,111 7,313,784
Gas plant and gathering system 1,451,074 2,976,216
Other 5,885,185 5,611,679
---------------------------------
270,353,959 248,074,991
---------------------------------
Less accumulated depreciation, depletion and amortization (42,518,775) (30,728,018)
---------------------------------
227,835,184 217,346,973
---------------------------------
OTHER ASSETS, NET 2,472,166 3,438,656
---------------------------------
TOTAL ASSETS $ 246,584,903 $ 234,654,935
=================================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 3,183,869 $ 4,439,487
Accrued property taxes payable 900,000 528,458
Accrued liabilities 831,277 831,359
Accrued swap contract liability -- 1,646,269
Accrued interest payable 911,295 341,177
---------------------------------
TOTAL CURRENT LIABILITIES 5,826,441 7,786,750
---------------------------------
LONG-TERM DEBT 100,000,000 88,000,000
DEFERRED INCOME TAXES 11,513,067 10,794,762
OTHER DEFERRED LIABILITIES 750,000 750,000
COMMITMENTS AND CONTINGENCIES -- --
SHAREHOLDERS' EQUITY:
Preferred stock, no par value, 10,000,000 shares authorized,
none issued and outstanding -- --
Common Stock, no par value, 100,000,000 shares authorized,
19,697,036 shares issued and outstanding (19,697,036 in 1995) 196,970 196,970
Paid-in capital 134,541,050 134,541,050
Retained deficit (6,242,625) (7,414,597)
---------------------------------
TOTAL SHAREHOLDERS' EQUITY 128,495,395 127,323,423
---------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 246,584,903 $ 234,654,935
=================================
</TABLE>
See accompanying notes.
4
<PAGE> 5
HUGOTON ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30,
1996 1995
-----------------------------------
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 1,171,972 $ (394,401)
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY
OPERATING ACTIVITIES:
Depreciation, depletion, and amortization 12,271,621 4,303,586
Gain on sale of marketable securities -- (72,541)
Loss on sale of properties -- 34,210
Gain on sale of other property and equipment (69,591) (20,580)
Deferred income taxes 718,305 --
Other non-cash charges 109,166 --
CHANGES IN OPERATING ASSETS AND LIABILITIES:
Income tax receivable -- 878,398
Accounts receivable (1,167,968) 70,519
Other current assets 367,396 (65,580)
Other 547,741 (7,571)
Accounts payable (1,255,618) (1,627,930)
Accrued liabilities 941,578 (716,617)
Accrued swap contract liability (1,646,269) --
Deferred liabilities -- 150,000
-----------------------------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 11,988,333 2,531,493
-----------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to properties and equipment (28,682,284) (17,749,469)
Proceeds from sales of marketable securities -- 11,157,602
Proceeds from sale of proved properties and other assets 6,301,626 128,289
Net change in note receivable -- (27,691)
-----------------------------------
NET CASH USED IN INVESTING ACTIVITIES (22,380,658) (6,491,269)
-----------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long term debt 22,000,000 13,000,000
Repayment of long term debt (10,000,000) (10,000,000)
-----------------------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 12,000,000 3,000,000
-----------------------------------
Net increase (decrease) in cash 1,607,675 (959,776)
Cash at beginning of period 3,913,958 1,666,032
-----------------------------------
Cash at end of period $ 5,521,633 $ 706,256
===================================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid $ 2,560,803 $ 2,791,358
</TABLE>
See accompanying notes.
5
<PAGE> 6
HUGOTON ENERGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1. INTERIM FINANCIAL STATEMENTS
The consolidated financial statements at June 30, 1996 and for the six
month period then ended are unaudited and reflect all adjustments (consisting
of only normal recurring adjustments) which are, in the opinion of management,
necessary for a fair presentation of the financial position and operating
results for the interim period. The consolidated financial statements should
be read in conjunction with the consolidated financial statements and notes
thereto, together with management's discussion and analysis of financial
condition and results of operations, contained in the Company's Annual Report
on Form 10-K for the fiscal year ended December 31, 1995. The results of
operations for the six months ended June 30, 1996 are not necessarily
indicative of the results which may be expected for any other interim period or
for the entire fiscal year ending December 31, 1996.
NOTE 2. EARNINGS PER COMMON SHARE
The Company's earnings per common share has been computed based on the
weighted average number of shares outstanding during the period.
NOTE 3. PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION
The accompanying unaudited pro forma results of operations give effect
to the Consolidated Oil & Gas, Inc. (COG) and Mobil acquisitions as if the
transactions had occurred on January 1, 1995 under the purchase method of
accounting. The unaudited pro forma results of operations data is presented
for illustrative purposes and is not necessarily indicative of the actual
results that would have occurred had the acquisitions been consummated as of
January 1, 1995 or of future results of operations. The data reflects
adjustments for (a) the mark to market of open hedging contracts held by COG at
the time of acquisition, (b) the estimated change in general and administrative
expenses giving effect to integration of the administrative functions of the
combined companies, (c) the estimated increase in depreciation, depletion and
amortization relating to the acquisitions, (d) the estimated increase in
interest expense resulting from the increased borrowings relating to the
acquisitions and (e) the estimated provision for income taxes for the change in
income taxes resulting from the inclusion of the historical results of
operations of the acquisitions and the adjustments in (a) through (d) above.
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, 1995 JUNE 30, 1995
------------- ----------------
(IN THOUSANDS, EXCEPT (IN THOUSANDS, EXCEPT
PER SHARE DATA) PER SHARE DATA)
<S> <C> <C>
Unaudited pro forma information:
Revenues . . . . . . . . . . . . $ 14,782 $ 31,184
Net loss . . . . . . . . . . . . $ (1,471) $ (563)
Net loss per share . . . . . . . $ (.07) $ (.03)
</TABLE>
6
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
OVERVIEW
Hugoton Energy Corporation, a Kansas corporation, (together with its
subsidiaries, "the Company") is an independent oil and natural gas company
engaged in the exploration for and the development, production and acquisition
of oil and natural gas. The Company's properties are primarily located in the
four states of Kansas, Oklahoma, Texas and North Dakota. The Company is one of
the most active independent operators in the Hugoton Field and has recently
expanded its operations to other significant basins in the mid-continent region
of the United States.
Since the Company's formation in 1987, it has operated aggressive
drilling and acquisition programs. As a result, the Company's reserves have
increased from 13 BCFE on December 31, 1990 to over 276 BCFE on December 31,
1995. During the same period, the Company's average daily production has
increased from 2.3 MMCFE to 86.8 MMCFE.
Through June 30, 1996, the Company has drilled 22 wells and
successfully completed 17 wells for a success rate of 77%. The Company has
drilled three wells on its Austin Chalk acreage, is presently drilling the
fourth well and has plans to drill up to nine additional wells in the Austin
Chalk Trend during the remainder of 1996.
CURRENT DEVELOPMENTS
1996 Acquisitions and Sales of Properties
On June 20, 1996, the Company purchased a 50% working interest for
$12.9 million in approximately 95,000 gross acres in the Austin Chalk Trend in
Louisiana. This acreage acquisition, coupled with the January 1, 1996 acreage
acquisition mentioned below, presents the Company with a total of approximately
135,000 gross acres in the Austin Chalk Trend to explore, on which the Company
has preliminarily identified 24 drilling locations.
On April 29, 1996, the Company sold its interest in a group of
non-strategic producing gas properties and gas gathering and salt water
disposal system located in Southern Colorado and Northern New Mexico to a major
oil company. The sales price of the transaction was $4.5 million.
On February 15, 1996, the Company sold its interest in approximately
450 non-strategic producing oil properties located in Northeast Oklahoma for
$1.5 million.
On January 1, 1996, the Company purchased a group of producing oil and
gas properties and undeveloped acreage for $9.7 million from a privately-held
company that operates the properties. The producing properties and acreage are
located in Southeast Texas and established a presence for the Company in the
Austin Chalk trend. The acquisition included eight producing wells and 35,000
gross acres, of which the Company's working interest is 25% and 50%
respectively.
7
<PAGE> 8
RESULTS OF OPERATIONS
The following table sets forth certain operating information of the
Company for the periods shown:
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
1996 1995 1996 1995
---- ---- ----- -----
<S> <C> <C> <C> <C>
Net production (1):
Natural gas (MMCF) 4,877 3,001 9,719 5,896
Oil (MBBLS) 405 122 857 240
Natural gas equivalents (MMCFE) 7,307 3,733 14,861 7,336
Average net daily production (1):
Natural gas (MCF) 53,596 32,983 53,402 32,576
Oil (BBLS) 4,453 1,342 4,706 1,325
Natural gas equivalents (MCFE) 80,314 41,035 81,638 40,526
Average sales price per unit (2):
Natural Gas ($/MCF) $1.78 $1.20 $1.70 $1.21
Oil ($/BBL) 17.84 17.21 17.42 16.88
Natural gas equivalents ($/MCFE) 2.18 1.53 2.12 1.52
- --------------
</TABLE>
(1) Net production and average net daily production excludes NGLs and
natural gas purchased by AmGas (100% owned subsidiary of the Company)
from and sold to unrelated third parties.
(2) Average prices received from sales of natural gas include revenues
attributable to NGLs as the Company has not historically accounted
separately for production or revenues attributable to NGLs.
Three Months Ended June 30, 1996 Compared to Three Months Ended
June 30, 1995
Net Income or Loss and Cash Flow from Operating Activities. For the
three months ended June 30, 1996, the Company reported net income of $0.7
million, or $.04 per share, on total revenue of $16.3 million. This compares
to a net loss of $0.4 million, or $.04 per share, on total revenues of $6.1
million for the three months ended June 30, 1995. Cash flows from operating
activities for the three months ended June 30, 1996 increased to $7.6 million
from $2.5 million for the same period in 1995. The increase in net income and
cash flows for 1996 is largely attributable to the impact of the addition of
the properties acquired in the COG acquisition completed in September of 1995,
higher prices per MCFE received by the Company ($2.18 in 1996 vs. $1.53 in
1995), and the continued success of the Company's drilling program. The
Company's net income, cash flow and realized oil and natural gas prices for the
second quarter of 1996 were negatively impacted by oil and natural gas swap
contracts whereby net income was reduced by $1.7 million for the three months
ended June 30, 1996.
Oil and Gas Revenues. Revenues from oil and gas operations totaled
$15.9 million for the three months ended June 30, 1996 as compared to $5.7
million for the same period during 1995, representing a 179% increase. The
increase from 1995 to 1996 is attributed to the significant increase in oil and
natural gas prices during the second quarter of 1996 versus 1995 as well as the
inclusion of the COG and Mobil acquisition properties respectively and the
continued success of the Company's drilling program.
Production Expense. Production expense for the three months ended
June 30, 1996, increased to $5.4 million compared to $1.8 million during the
same period of 1995. This reflects the addition of a substantial number of
wells (through the COG and Mobil acquisitions and the Company's drilling
program), and the increase in the oil component of the Company's production.
General and Administrative Expense. General and administrative
expense increased to $1.6 million in the three month period ended June 30,
1996, compared to $0.9 million for the same period in 1995. This increase
reflects the continued expansion of the Company's operations and the associated
costs of additional personnel;
8
<PAGE> 9
however; these expenses declined when expressed as a percentage of revenues
reflecting the Company's efforts to acquire properties that can be incorporated
into its existing property base with minimal incremental general and
administrative expense.
Depreciation, Depletion and Amortization Expense. Depreciation,
depletion and amortization ("DD&A") for the three months ended June 30, 1996
was $6.0 million compared to $2.2 million for the same period of 1995. The
increase in the Company's DD&A expense is mainly due to higher production
levels in 1996 compared to 1995 and the result of increased DD&A rates
resulting from the application of the fair market value basis allocated to
proved oil and gas properties acquired from COG.
Income Taxes. For the three months ended June 30, 1996, the Company
recorded a tax provision of $0.4 million compared to no provision or benefit
for the same period of 1995. The provision recorded in 1996 reflects an
effective tax rate of 38%. No tax benefit or provision was recorded in 1995
due to permanent differences offsetting the Company's taxable income.
Six Months Ended June 30, 1996 Compared to Six Months Ended June 30, 1995
Net Income or Loss and Cash Flow from Operating Activities. For the
six months ended June 30, 1996, the Company reported net income of $1.2
million, or $.06 per share, on total revenue of $32.4 million. This compares
to a net loss of $0.4 million, or $.04 per share, on total revenues of $12.3
million for the six months ended June 30, 1995. Cash flows from operating
activities for the six months ended June 30, 1996 increased to $12.0 million
from $2.5 million for the same period in 1995. The increase in net income and
cash flows for 1996 is largely attributable to the impact of the addition of
the properties acquired in the COG acquisition completed in September of 1995,
higher prices per MCFE received by the Company ($2.12 in 1996 vs. $1.52 in
1995), and the continued success of the Company's drilling program. The
Company's net income, cash flow and realized oil and natural gas prices for
first six months of 1996 were negatively impacted by oil and natural gas swap
contracts whereby net income was reduced by $2.5 million for the six months
ended June 30, 1996.
Oil and Gas Revenues. Revenues from oil and gas operations totaled
$31.5 million for the six months ended June 30, 1996 as compared to $11.4
million for the same period during 1995, representing a 176% increase. The
increase from 1995 to 1996 is attributed to the significant increase in oil and
natural gas prices during the first six months of 1996 versus 1995 as well as
the inclusion of the COG and Mobil acquisition properties respectively and the
continued success of the Company's drilling program.
Production Expense. Production expense for the six months ended June
30, 1996, increased to $10.8 million compared to $3.6 million during the same
period of 1995. This reflects the addition of a substantial number of wells
(through the COG and Mobil acquisitions and the Company's drilling program),
and the increase in the oil component of the Company's production.
General and Administrative Expense. General and administrative
expense increased to $3.4 million in the six month period ended June 30, 1996,
compared to $1.6 million for the same period in 1995. This increase reflects
the continued expansion of the Company's operations and the associated costs of
additional personnel; however; these expenses declined when expressed as a
percentage of revenues reflecting the Company's efforts to acquire properties
that can be incorporated into its existing property base with minimal
incremental general and administrative expense.
Depreciation, Depletion and Amortization Expense. Depreciation,
depletion and amortization ("DD&A") for the six months ended June 30, 1996 was
$12.3 million compared to $4.3 million for the same period of 1995. The
increase in the Company's DD&A expense is mainly due to higher production
levels in 1996 compared to 1995 and the result of increased DD&A rates
resulting from the application of the fair market value basis allocated to
proved oil and gas properties acquired from COG.
9
<PAGE> 10
Income Taxes. For the six months ended June 30, 1996, the Company
recorded a tax provision of $0.7 million compared to no provision or benefit
for the same period of 1995. The provision recorded in 1996 reflects an
effective tax rate of 38%. No tax benefit or provision was recorded in 1995
due to permanent differences offsetting the Company's taxable income.
LIQUIDITY AND CAPITAL RESOURCES
The Company's working capital position increased by $4.4 million from
year-end 1995 to $10.5 million at June 30, 1996. Cash and accounts receivable
increased by $1.6 million and $1.2 million, respectively. The Company's
current ratio of current assets to current liabilities was 1.8 at December 31,
1995 and 2.8 at June 30, 1996.
Capital Expenditures. The Company's primary needs for cash are for
exploration, development and acquisitions of oil and gas properties, payment of
interest on outstanding indebtedness and working capital obligations. The
Company's 1996 capital expenditure budget has been increased to $32 million, of
which over $20 million has been committed to drilling. Through June 30, 1996,
the Company has expended $22.6 for acquisitions and $5.1 on its drilling
program. Funding for the Company's exploration and development activities and
its working capital obligations is provided primarily by internally-generated
cash flow. The Company budgets its capital expenditures based on projected
cash flows and routinely adjusts the level of its capital expenditures in
response to anticipated changes in cash flows.
During the first six months of 1996, the Company's borrowings
increased by $12 million as a result of acquisitions by the Company's of
certain producing properties and undeveloped acreage totaling $22.6 million.
The additional monies needed to fund these transactions was generated through
internal cash flows and the proceeds from property sales during 1996.
Capital Resources. The Company's capital resources consist of cash
flow from operating activities and funds available under its bank Credit
Facility. On September 7, 1995, the Company arranged a new bank Credit
Facility which is an unsecured $250 million revolving credit agreement that is
due September 7, 1999. The new facility is provided by seven commercial banks,
led by Bank One, Texas as agent and Texas Commerce Bank National Association as
co-agent. The Borrowing Base, as defined in the credit agreement, is currently
set at $135 million, and is subject to semi-annual redetermination.
Outstanding borrowings were $100 million at June 30, 1996.
The Credit Facility provides the option of borrowing at floating
interest rates based on Bank One's base rate or at a Eurodollar option based on
the London Interbank Offered Rates ("LIBOR") plus 3/4 of 1% to 1.25%,
depending on the outstanding loan balance. Interest is paid quarterly or at
the end of each interest period. The current weighted average interest rate is
6.49% The Company also incurs a commitment fee of 1/4 of 1% on the unused
portion of the Borrowing Base. In addition, the Credit Facility also contains
customary restrictive covenants, including restrictions on the payment of
dividends in excess of 50% of the Company's annual net income, and requires the
Company to maintain certain financial ratios.
The Company has historically funded its operations and capital
spending programs with cash flow from operations and borrowings under bank
credit facilities. The Company believes that cash flow from operations and the
borrowing availability under the Credit Facility will be sufficient to meet its
anticipated capital requirements for 1996. However, because future cash flows
and the availability of financing are subject to a number of variables, such as
the level of production and the prices received for natural gas and oil, there
can be no assurance that the Company's capital resources will be sufficient to
maintain currently planned levels of capital expenditures.
In general, because the Company's principal natural gas and oil
reserves are depleted by production, its success is dependent upon the results
of its development, acquisition and exploration activities.
10
<PAGE> 11
PART II. OTHER INFORMATION
ITEMS 1, 2, 3, 5 & 6 ARE NOT APPLICABLE AND HAVE BEEN OMITTED.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Company's Annual Meeting of Stockholders, held May 16, 1996, the
following individuals were elected to the Board of Directors:
Floyd C. Wilson - Class III director, term expires at annual meeting of
stockholders in 1999
A. Mark Womble - Class III director, term expires at annual meeting of
stockholders in 1999
J. W. Decker - Class III director, term expires at annual meeting of
stockholders in 1999
The following members of the Board of Directors had terms which continued after
the meeting:
Stephen Berger - Class II director, term expires at annual
meeting of stockholders in 1997
David H. Kennedy - Class II director, term expires at annual
meeting of stockholders in 1997
William E. Macaulay - Class II director, term expires at annual
meeting of stockholders in 1997
David S. Elkouri - Class I director, term expires at annual
meeting of stockholders in 1998
John T McNabb, II - Class I director, term expires at annual
meeting of stockholders in 1998
Alan J. Andreini - Class I director, term expires at annual
meeting of stockholders in 1998
The following proposals were approved at the Company's Annual meeting:
<TABLE>
<CAPTION>
Affirmative Negative Votes
Votes Votes Withheld
----------- -------- --------
<S<C> <C> <C> <C>
1. Election of three Class III directors to 13,296,014 0 4,735
the Board of Directors
2. Consider and approve the Hugoton Energy 13,119,941 46,657 27,035
Corporation Amended and Restated 1993
Nonemployee Directors' Stock Option Plan
3. Consider and approve a Nonstatutory Stock 13,119,883 34,927 38,823
Option Agreement between the Company
and Jay W. Decker dated September 8, 1995
4. Consider and ratify the appointment of 13,288,611 4,900 7,238
Ernst & Young LLP as the independent
accountants of the Company for the fiscal
year ending December 31, 1996
</TABLE>
11
<PAGE> 12
SIGNATURE
Pursuant to the requirements Section 13 or 15 (d) of the Securities Exchange
Act 1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized, on the 13th day of August, 1996.
HUGOTON ENERGY CORPORATION
(Registrant)
Date: August 13, 1996 /s/ W. Mark Womble
--------------------- ---------------------------------------------
W. Mark Womble, Executive Vice President,
Chief Financial Officer and Director
(Chief Financial Officer and
Duly Authorized Officer)
12
<PAGE> 13
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- -----------
Exhibit 27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 5,522
<SECURITIES> 0
<RECEIVABLES> 10,027
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 16,278
<PP&E> 270,354
<DEPRECIATION> 42,519
<TOTAL-ASSETS> 246,585
<CURRENT-LIABILITIES> 5,826
<BONDS> 0
<COMMON> 197
0
0
<OTHER-SE> 128,298
<TOTAL-LIABILITY-AND-EQUITY> 246,585
<SALES> 32,393
<TOTAL-REVENUES> 32,403
<CGS> 11,487
<TOTAL-COSTS> 11,487
<OTHER-EXPENSES> 16,135
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,981
<INCOME-PRETAX> 1,890
<INCOME-TAX> 718
<INCOME-CONTINUING> 1,172
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,172
<EPS-PRIMARY> 0.06
<EPS-DILUTED> 0.06
</TABLE>
