<PAGE> 1
[LOGO]
The
PHOENIX
RESOURCE COMPANIES, INC.
- --------------------------------------------------------------------------------
SECOND QUARTER 1995
QUARTERLY REPORT
[Graphic Artwork
of Egyptian Sphinx
and pyramids.]
<PAGE> 2
FINANCIAL & OPERATING HIGHLIGHTS
(In thousands except per share data, prices and production)
(Unaudited)
<TABLE>
<CAPTION>
QUARTER ENDED JUNE 30 SIX MONTHS ENDED JUNE 30
---------------------------- --------------------------
1995 1994 1995 1994
--------- ---------- --------- ---------
<S> <C> <C> <C> <C>
RESULTS OF OPERATIONS
Operating Revenues .................................... $ 8,879 $ 8,553 $ 17,196 $ 15,249
Total Revenues ......................................... $ 9,315 $ 8,798 $ 18,002 $ 15,735
Net Income ............................................. $ 3,002 $ 3,362 $ 6,086 $ 5,803
Net Income Per Share ................................... $ 0.37 $ .041 $ 0.76 $ 0.69
FINANCIAL POSITION (AT END OF PERIOD)
Working Capital ........................................ $ 28,201 $ 25,950 $ 28,201 $ 25,950
Total Assets ........................................... $ 56,125 $ 47,694 $ 56,125 $ 47,694
Debt ................................................... $ -- $ -- $ -- $ --
Stockholders' Equity ................................... $ 37,698 $ 30,649 $ 37,698 $ 30,649
OPERATING HIGHLIGHTS
Khalda Daily Oil Production (gross bbls) ............... 30,415 32,917 30,891 32,085
Average Oil Price ...................................... $ 17.79 $ 15.91 $ 17.32 $ 15.07
COMMON STOCK INFORMATION
Shares Outstanding ..................................... 7,792 8,099 7,792 8,099
High Sales Price ....................................... $ 35.50 $ 13.81 $ 35.50 $ 19.94
Low Sales Price ........................................ $ 21.75 $ 11.13 $ 18.75 $ 11.13
Closing Sales Price .................................... $ 31.75 $ 13.13 $ 31.75 $ 13.13
Cash Dividends Per Share ............................... $ 0.04 $ 0.025 $ 0.08 $ 0.050
</TABLE>
Front Cover:
The Sphinx is one of the most celebrated monuments in Egypt. It is the figure
of a recumbent lion hewn from natural rock with the head of a Pharaoh, wearing
the royal headcloth and cobra. Much damage has been wrought to the Sphinx over
time, due to weathering and deliberate mutilation; however, the Sphinx still
conveys a powerful impression of majesty and artistic achievement.
<PAGE> 3
PHOENIX HEADLINES - 2ND QUARTER 1995
EARNINGS. Second quarter 1995 earnings were $3,002,000, or $0.37 per share,
compared to $3,362,000, or $0.41 per share, for second quarter 1994. For the
first six months of 1995, earnings were $6,086,000, or $0.76 per share,
compared to $5,803,000, or $0.69 per share, for the first six months of 1994.
Earnings for the first half of 1995 were 5% higher than last year, and, on a
per share basis, earnings were up by 10%. Higher earnings were largely
attributable to higher oil prices, which were up 15% from the first half of
1994. Per share earnings were also positively influenced by share repurchases
in 1994 and 1995 which served to reduce the weighted number of shares
outstanding.
QARUN CONCESSION. Operations have continued at a brisk pace in the two million
acre Qarun Concession, where Phoenix is the operator and owns 50% of the
contractor interest. During the second quarter, the Qarun #3 well was
successfully production tested at cumulative rates of up to 11,957 barrels of
oil per day. (Wells named El Sagha #1, #2 and #3 have been renamed Qarun #1,
#2, and #3.)
The successful testing of the Qarun #3 well, combined with the discoveries made
by the Qarun #1 and #2 wells, establishes the commerciality of this area of the
Qarun Concession and activities are geared to commencing full scale production
before the end of 1996.
Plans are being made for the construction of central production facilities with
an initial capacity of 40,000 barrels of oil per day. A 50 kilometer pipeline
will be constructed to deliver crude production to the Dahshour booster station
of the Sumed pipeline. Large storage facilities will be constructed at the
booster station to accept the crude and allow batch shipments of several
hundred thousand barrels. The small volumes of natural gas associated with the
oil production will be sold through an existing natural gas pipeline that
crosses the productive area. Total costs of this entire initial development
program, including development drilling, are estimated to be no more than $125
million, 50% of which will be funded by Phoenix. The central facilities are
being designed to accommodate expansions in oil production capacity if required
to develop additional discoveries.
Phoenix has engaged the International Finance Corporation, an affiliate of the
World Bank, to assist it in arranging financing for its share of the Qarun
development program, with such loan being in the range of $50 million.
A 3-D seismic program commenced in the second quarter covering an area of
approximately 250 square kilometers. This program is primarily for the purpose
of assisting development activities and covers the Qarun area and the Sakr area
where exploratory drilling is now underway. Shooting of the 3-D seismic should
be completed during the third quarter, and several hundred kilometers of 2-D
seismic will be shot immediately thereafter to better define several
exploratory leads in the northwestern quadrant of the concession.
The Sakr #1X wildcat well was spudded on July 21. It is planned for this well
to have a total depth of approximately 14,300 feet to test Bahariya, Kharita
and deeper Alam El Bueib objectives. The well is looking for separate
accumulations of hydrocarbons about four kilometers southwest of the Qarun
fields. Final results are expected no sooner than ninety days from spudding.
The Qarun #4 development well was spudded on July 20. This well is downdip from
the Qarun #1 well drilled in 1994, and is designed to help define the downdip
limits of the Qarun field. The well is expected to be drilled to a depth of
approximately 9,600 feet and results are expected no sooner than sixty days
from spudding.
During the second quarter the Nesr #1X exploratory well was spudded, 38
kilometers southwest of the Qarun field. This well bottomed out in basement
rock at a depth of 9,800 feet, and although a dry hole, yielded valuable
geological and geophysical data.
Current plans envision the continued use of two drilling rigs for development
drilling in the Qarun fields for the remainder of 1995 and beyond. Exploratory
drilling plans beyond the Sakr #1X have not yet been finalized.
<PAGE> 4
SOUTH KHALDA BLOCK. During April 1995 the Egyptian Parliament approved the
award of the South Khalda Block to the Khalda partners, and in May the
amendment to the Khalda Concession adding the South Khalda Block was finalized.
This two million acre area surrounds the Khalda Concession and other producing
areas in the Western Desert. Assuming production is established from the South
Khalda Block, the area will be economically merged with the main Khalda
Concession. Phoenix will pay 40% of the costs incurred in this area and be
entitled to 40% of the contractor revenue. The Khalda partners will drill at
least seven wells on this acreage over the next four years. Exploratory
operations are underway. Plans to immediately shoot about 720 kilometers of
2-D seismic were recently approved, and exploratory drilling is scheduled to
begin next year with the drilling of at least two exploratory wells in 1996.
KHALDA CONCESSION. Development drilling continued in the 12 producing oil
fields of the 320,000 acre Khalda Concession during the second quarter of 1995
with the drilling of three development wells. At least nine additional Khalda
development wells are currently scheduled for 1995, making the level of 1995
development drilling comparable to that of 1994.
During the second quarter two exploratory wells were drilled on the Khalda
Concession: South Safir and West Bassel. The South Safir well was a dry hole.
The West Bassel well was an unsuccessful exploratory well at its deeper
exploratory objectives, but it was completed and put on production as a shallow
development well in the Shrouk field, which was discovered in 1994.
The Nadr well, located a few kilometers south of the Shrouk fields, recently
reached total depth. The Nadr well encountered Bahariya and Abu Roash pay
sands, and is in the process of being completed and connected to facilities. It
should commence production in a few weeks. Preliminary assessment of the well
suggests that it is a discovery of a few million barrels of oil, but testing
and detailed mapping will be needed to further define reserve potential.
Once the Nadr well is completed, the rig will move to the Salam South location
to spud an exploratory well just south of the existing Salam field. An
additional three wildcat wells will be drilled on the Khalda Concession this
year, with at least two of these likely having deeper gas objectives.
Contractors in areas adjoining the Khalda Concession also have plans to drill
several gas wells over the next six to eight months and discussions among the
contractors in the area pertaining to a unified natural gas project continue.
DIVIDENDS. For the second quarter of 1995, a regular quarterly dividend of
$0.04 per share was declared and paid on June 30,1995.
RESEARCH REPORTS. Current research reports about the Company have been
published by Howard Weil, Oppenheimer & Co. and Petrie Parkman. To receive
copies of any of these reports call Investor Relations at (405) 728-5100.
The Common Stock of The Phoenix Resource Companies, Inc. is traded on the
American Stock Exchange and The Pacific Stock Exchange under the symbol PHN.
<PAGE> 5
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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
JUNE 30, 1995
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 1-547
__________________________
THE PHOENIX RESOURCE COMPANIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 95-1927105
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
6525 North Meridian Avenue
Oklahoma City, Oklahoma 73116-1491
(Address of Principal Executive Offices) (Zip Code)
(405) 728-5100
(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 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
------- -------
APPLICABLE ONLY TO CORPORATE ISSUERS:
At July 24, 1995 there were 7,792,098 shares of the registrant's
common stock outstanding.
<PAGE> 6
TABLE OF CONTENTS
PART I
FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Page
<S> <C>
Consolidated Statement of Income -
Three Months and Six Months Ended June 30, 1995 and 1994 . . . . . . . . . . . . . . . . . . 3
Consolidated Balance Sheet at June 30, 1995 and December 31, 1994 . . . . . . . . . . . . . . . . 4
Consolidated Statement of Cash Flows -
Six Months Ended June 30, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Notes to Unaudited Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . 6
Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . 7
PART II
OTHER INFORMATION
Submission of Matters to a Vote of Security Holders . . . . . . . . . . . . . . . . . . . . . . . 9
</TABLE>
2
<PAGE> 7
THE PHOENIX RESOURCE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(In thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ---------------------
1995 1994 1995 1994
---------- --------- -------- --------
<S> <C> <C> <C> <C>
Revenues:
Oil and gas revenues . . . . . . . . . . . . . $ 5,891 $ 5,786 $11,377 $ 10,260
Revenues dedicated to foreign tax liability . . 2,988 2,767 5,819 4,989
-------- ------- ------- --------
Operating revenues . . . . . . . . . . . . . 8,879 8,553 17,196 15,249
Interest and other income . . . . . . . . . . 436 245 806 486
-------- ------- ------- --------
9,315 8,798 18,002 15,735
-------- ------- ------- --------
Costs and Expenses:
Production costs . . . . . . . . . . . . . . . 1,654 1,656 3,031 2,758
Depreciation, depletion and amortization . . . 937 390 1,732 762
General and administrative . . . . . . . . . . 684 553 1,231 1,301
-------- ------- ------- --------
3,275 2,599 5,994 4,821
-------- ------- ------- --------
Income before income taxes . . . . . . . . . . . 6,040 6,199 12,008 10,914
Provision for income taxes:
U.S. alternative minimum tax . . . . . . . . . 50 70 103 122
Foreign . . . . . . . . . . . . . . . . . . . 2,988 2,767 5,819 4,989
-------- ------- ------- --------
Net income . . . . . . . . . . . . . . . . . $ 3,002 $ 3,362 $ 6,086 $ 5,803
======== ======= ======= ========
Income Per Share:
Weighted average common and common
equivalent shares outstanding . . . . . . . 8,040 8,272 8,013 8,422
======== ======= ======= ========
Net income . . . . . . . . . . . . . . . . . $ 0.37 $ 0.41 $ 0.76 $ 0.69
======== ======= ======= ========
</TABLE>
Prior year has been restated to reflect the change to full cost accounting.
The accompanying notes are an integral part of this statement.
3
<PAGE> 8
THE PHOENIX RESOURCE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(In thousands, except per share data)
ASSETS
<TABLE>
<CAPTION>
JUNE 30, December 31,
1995 1994
------------- --------------
Current Assets: (Unaudited)
<S> <C>
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . $ 26,602 $ 26,536
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . 2,894 2,561
Receivable for payment of foreign taxes . . . . . . . . . . . . . 5,819 10,657
Other current assets . . . . . . . . . . . . . . . . . . . . . . . 837 491
-------- --------
36,152 40,245
-------- --------
Property and Equipment, at cost:
Oil and gas properties (using full cost accounting) . . . . . . . 23,573 18,624
Other property and equipment . . . . . . . . . . . . . . . . . . 2,016 1,909
-------- --------
25,589 20,533
Less: Accumulated depreciation, depletion and amortization . . . . . 15,492 13,800
-------- --------
Net Property and Equipment . . . . . . . . . . . . . . . . . . . . 10,097 6,733
Deferred Receivable for payment of foreign taxes . . . . . . . . . . 9,623 9,211
Other Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253 252
-------- --------
$ 56,125 $ 56,441
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,525 $ 1,062
Accrued foreign taxes . . . . . . . . . . . . . . . . . . . . . . 5,819 10,657
Other accrued liabilities . . . . . . . . . . . . . . . . . . . . 607 857
-------- --------
7,951 12,576
-------- --------
Long-Term Obligations:
Deferred foreign taxes . . . . . . . . . . . . . . . . . . . . . . 9,623 9,211
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . 853 1,096
-------- --------
10,476 10,307
-------- --------
Commitments and Contingencies (Note 4)
Stockholders' Equity:
Preferred stock, par value $0.01 (authorized 5,000 shares, none
outstanding) . . . . . . . . . . . . . . . . . . . . . . . . . . -- --
Common stock, par value $0.01 (authorized 20,000 shares, 7,792
shares outstanding in 1995 and 7,854 in 1994) . . . . . . . . . 85 85
Paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . 39,376 39,396
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . 8,392 2,929
Treasury stock, at cost (689 shares in 1995 and 627 shares in
1994) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10,155) (8,852)
-------- --------
37,698 33,558
-------- --------
$ 56,125 $ 56,441
======== ========
</TABLE>
The accompanying notes are an integral part of this balance sheet.
4
<PAGE> 9
THE PHOENIX RESOURCE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
--------------------------
1995 1994
--------- ---------
<S> <C> <C>
Cash flows from operating activities:
Cash received from purchasers . . . . . . . . . . . . . . . . . . $ 11,039 $ 8,422
Cash paid to suppliers and employees . . . . . . . . . . . . . . . (4,133) (4,234)
Income taxes paid . . . . . . . . . . . . . . . . . . . . . . . . (445) (379)
Interest and other cash receipts . . . . . . . . . . . . . . . . . 691 323
-------- --------
Net cash provided by operating activities . . . . . . . . . . . 7,152 4,132
-------- --------
Cash flows from investing activities:
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . (5,140) (1,415)
-------- --------
Net cash used in investing activities . . . . . . . . . . . . . (5,140) (1,415)
-------- --------
Cash flows from financing activities:
Purchase of treasury stock . . . . . . . . . . . . . . . . . . . . (1,421) (3,997)
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . (623) (416)
Proceeds from stock options exercised . . . . . . . . . . . . . . 98 18
-------- --------
Net cash used in financing activities . . . . . . . . . . . . . (1,946) (4,395)
-------- --------
Net increase (decrease) in cash and cash equivalents . . . . . . . . 66 (1,678)
Cash and cash equivalents, beginning of period . . . . . . . . . . . 26,536 25,248
-------- --------
Cash and cash equivalents, end of period . . . . . . . . . . . . $ 26,602 $ 23,570
======== ========
Reconciliation of net income to net cash provided
by operating activities:
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,086 $ 5,803
-------- --------
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation, depletion and amortization . . . . . . . . . . . . 1,732 762
Capitalized general and administrative . . . . . . . . . . . . . (310) (314)
Increase in accounts receivable related to operating
activities . . . . . . . . . . . . . . . . . . . . . . . . . . (333) (1,994)
Increase in accounts payable related to operating activities . . 406 273
Decrease in accrued liabilities related to operating
activities . . . . . . . . . . . . . . . . . . . . . . . . . . (250) (139)
Other noncash items . . . . . . . . . . . . . . . . . . . . . . (179) (259)
-------- --------
Total adjustments . . . . . . . . . . . . . . . . . . . . . . 1,066 (1,671)
-------- --------
Net cash provided by operating activities . . . . . . . . . $ 7,152 $ 4,132
======== ========
</TABLE>
Prior year has been restated to reflect the change to full cost accounting.
The accompanying notes are an integral part of this statement.
5
<PAGE> 10
THE PHOENIX RESOURCE COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 -- SIGNIFICANT ACCOUNTING POLICIES:
All references herein to the "Company" mean The Phoenix Resource
Companies, Inc. and/or one or more of its wholly-owned subsidiaries. The
accompanying unaudited consolidated financial statements and notes thereto have
been prepared in accordance with accounting policies set forth in the Company's
1994 Annual Report on Form 10-K and should be read in conjunction with the
Notes to Consolidated Financial Statements therein. The financial statements
reflect all adjustments, consisting of normal recurring accruals, which the
Company considers necessary for a fair presentation of the financial position
and the results of operations for such periods.
NOTE 2 -- CHANGE IN ACCOUNTING PRINCIPLE:
During the fourth quarter of 1994 the Company changed its method of
accounting for oil and gas operations from the successful efforts method to the
full cost method. The 1994 financial statements presented herein have been
restated to reflect the change.
NOTE 3 -- CAPITAL STOCK AND OPTIONS:
Capital Stock - A two-for-one split of the number of shares of Common
Stock outstanding was effected in January 1995. All references in the
accompanying 1994 financial statements to the number of common shares and per
share amounts have been restated to reflect the split.
During the first quarter of 1995 the Company purchased 70,000 shares
of its Common Stock in open market transactions at an average price of $20.30
per share. During the second quarter of 1994, 8,000 shares were issued from
Treasury Stock upon exercise of stock options. As of June 30, 1995 a total of
688,862 shares of Common Stock were held as Treasury Stock.
NOTE 4 -- COMMITMENTS AND CONTINGENCIES:
The Company conducts almost all of its business in Egypt. The
business environment in foreign countries varies greatly. Relevant factors
include the laws of a country, its political stability, the political stability
of its region of the world, its attitude toward foreign investments,
availability and skill of its work force and the technological sophistication
of its business community. Adverse developments in the business environment in
Egypt would likely have a material adverse effect on the Company. The Company
does not insure against political risks.
Egypt retains the right of requisition of production from Egyptian
concessions and cancellation of the concession agreements upon the occurrence
of specific events, including a national emergency due to war, imminent
expectation of war or internal causes, unauthorized assignment of interests in
the concession, the concession holder being adjudicated bankrupt by a court of
competent jurisdiction and intentional extraction of any mineral not authorized
by the concession agreement. Requisition or cancellation of the Company's
concession agreements as a result of the foregoing or for any other reasons
would have a material adverse effect on the Company.
The Company is committed, under certain circumstances, to pay
approximately $1.7 million pursuant to various employment contracts with
certain key employees.
6
<PAGE> 11
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The following discussion and analysis of the three months and six
months ended June 30, 1995 compared to the same periods of 1994 should be read
in conjunction with the Consolidated Financial Statements and Notes thereto.
The three months and six months ended June 30, 1994 have been restated to
reflect the change to full cost accounting.
Second Quarter 1995 Compared to Second Quarter 1994.
Net income for the second quarter of 1995 was $3 million compared to
$3.4 million for the same period of 1994. Net income decreased primarily due
to an increase in the non-cash charge for depreciation, depletion and
amortization ("DD&A expense"). DD&A expense increased in the second quarter of
1995 due to inclusion of costs from the Qarun Concession. In the second
quarter of 1994, most of the Company's capital expenditures were made in the
Khalda Concession, where the majority of such expenditures is paid by one of
the Company's partners.
The average price for Khalda Concession oil for the second quarter of
1995 was $17.79 per barrel compared to $15.91 per barrel received in the second
quarter of 1994. Average daily gross oil production from the Khalda Concession
was 30,415 barrels per day for the second quarter of 1995 compared to 32,917
barrels per day in the same period of 1994.
First Six Months of 1995 Compared to 1994.
Net income for the first six months of 1995 was $6.1 million compared
to $5.8 million for the same period of 1994. Net income increased primarily
due to an increase in the price received for Khalda Concession oil partially
offset by lower production from the Khalda Concession and increased DD&A
expense.
The average price for Khalda Concession oil for the first six months
of 1995 was $17.32 per barrel compared to $15.07 per barrel for the same period
of 1994. Average daily gross oil production from the Khalda Concession was
30,891 barrels per day for the six months ended June 30, 1995 compared to
32,085 barrels per day for the same period of 1994.
DD&A expense for the first six months of 1995 increased $1 million
compared to the same period of 1994 primarily due to the inclusion of costs
from the Qarun Concession. In the first six months of 1994, most of the
Company's capital expenditures were made in the Khalda Concession, where the
majority of such expenditures is paid by one of the Company's partners.
LIQUIDITY AND CAPITAL RESOURCES
As of June 30, 1995 the Company's working capital (current assets less
current liabilities) was $28.2 million, which included cash and cash
equivalents of $26.6 million. Net cash provided by operating activities for
the six months ended June 30, 1995 was $7.2 million. Cash utilized for
financing activities for the six months ended June 30, 1995 was $1.9 million,
which was used to repurchase the Company's Common Stock and pay dividends on
the Company's Common Stock. The Company currently has no long-term debt. Cash
utilized in investing activities was $5.1 million, which was primarily used for
exploration costs.
Currently, the Company's short-term and long-term sources of liquidity
are working capital and cash flow from operations. These sources of liquidity
would be available to fund a portion of the development of any of the Company's
exploratory successes, including recent
7
<PAGE> 12
discoveries in the Qarun Concession and any successes on the newly acquired
South Khalda block; to participate in the development of natural gas reserves
in the Khalda Concession; and to pursue other oil and gas opportunities that
may be identified by the Company. The Company has engaged the International
Finance Corporation, an affiliate of the World Bank, to assist it in arranging
financing for its share of capital expenditures related to the initial
development of the Qarun Concession, including construction of facilities and
pipeline. The Company believes that additional external sources of capital, if
needed, coupled with working capital and cash flow from operations, will
provide sufficient sources of short-term and long-term liquidity.
8
<PAGE> 13
PART II
OTHER INFORMATION
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The 1995 Annual Meeting of Stockholders of the Company was held on May
9, 1995 at the American Stock Exchange, New York, New York. The following were
reelected as directors of the Company, to serve until the 1998 Annual Meeting
of Stockholders: Galal P. Doss; Francis L. Durand; George D. Lawrence Jr.;
Lawrence M. Miller; Joseph A. Pardo; and Rex A. Sebastian.
At the 1995 Annual Meeting of Stockholders, the stockholders approved
a Certificate of Amendment to the Company's Amended and Restated Certificate of
Incorporation, effective May 9, 1995, increasing the number of authorized
shares of Common Stock from 10,000,000 to 20,000,000.
An amendment to the Company's 1990 Employee Stock Option Plan was
approved, the terms of which are fully described in the Company's Proxy
Statement dated March 29, 1995.
SIGNATURE
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.
THE PHOENIX RESOURCE COMPANIES, INC.
------------------------------------
(Registrant)
/s/Cheryl A. Rich
---------------------------------------------------
Cheryl A. Rich
Vice President & Chief Financial Officer
(Principal Financial & Accounting Officer)
DATE: July 27, 1995
9
<PAGE> 14
EXHIBIT INDEX
-------------
Exhibit 27 -- Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 26,602
<SECURITIES> 0
<RECEIVABLES> 2,894
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 36,152
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0
0
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</TABLE>
