Box Energy Completes Major Reorganization Resulting in 3rd Quarter Loss of $7.6 Million.DALLAS--(BUSINESS WIRE)--Nov. 4, 1997--Box Energy Corporation today announced a net loss for the third quarter of 1997 of $7.6 million or $0.37 per share. Reorganization The process of carrying out, through agreements and legal proceedings, a business plan for winding up the affairs of, or foreclosing a mortgage upon, the property of a corporation that has become insolvent. costs for the third quarter totaled $6.4 million or $0.32 per share, reflecting previously announced payments of $2.0 million to the Simplot The J. R. Simplot Company, commonly referred to as Simplot, was founded in 1923 by 14-year-old J. R. Simplot near the small agricultural community of Declo in south central Idaho. J. R. group to end their litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. against the company. Additionally, $1.2 million was paid to Tom Box for severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when payments and dismissal A discharge of an individual or corporation from employment. The disposition of a civil or criminal proceeding or a claim or charge made therein by a court order without a trial or prior to its completion which, in effect, is a denial of the relief sought by the commencement of the of his lawsuits against the company, and $2.7 million as severance for 18 employees who resigned. The remaining $500,000 was associated with severance payments to employees terminated ter·mi·nate v. ter·mi·nat·ed, ter·mi·nat·ing, ter·mi·nates v.tr. 1. To bring to an end or halt: by the Company and other expenses related to the recent change in control of the company. The severance agreements Noun 1. severance agreement - an agreement on the terms on which an employee will leave agreement, understanding - the statement (oral or written) of an exchange of promises; "they had an agreement that they would not interfere in each other's business"; "there was , entered into by prior management, could be self-triggered, if in the view of the employee, his/her job status or benefits changed negatively after a change of control. The severance agreement provided most employees' 18 months pay plus benefits. Management believes that existence of the agreements was disruptive disruptive /dis·rup·tive/ (-tiv) 1. bursting apart; rending. 2. causing confusion or disorder. and harmful Harmful is a rock band from Frankfurt, Germany, founded in 1992 and frequently compared to early Helmet and more occasionally to Blackmail [1]. The band has released seven albums to date, the first two and last three on independent labels (BluNoise, Steamhammer and to employee loyalty. In August of 1996, there were 55 full time employees which had been reduced to 31 employees prior to the recent resignations. The Company has stated that it should have approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 25 employees to efficiently conduct its operations and is now preparing to hire the additional staff to reach that level. James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. A. Watt, President and Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. of the company, stated, "Incurring in·cur tr.v. in·curred, in·cur·ring, in·curs 1. To acquire or come into (something usually undesirable); sustain: incurred substantial losses during the stock market crash. 2. these costs was very discouraging dis·cour·age tr.v. dis·cour·aged, dis·cour·ag·ing, dis·cour·ag·es 1. To deprive of confidence, hope, or spirit. 2. To hamper by discouraging; deter. 3. , but putting the legal problems, uncertain ownership and the onerous on·er·ous adj. 1. Troublesome or oppressive; burdensome. See Synonyms at burdensome. 2. Law Entailing obligations that exceed advantages. employee severance agreements behind us was necessary to allow management to focus on the future opportunities. We can now hire a small group of employees committed to building shareholder value." Exploration expenses decreased dramatically for the three and nine months ended September September: see month. 30, 1997, because of reductions in dry hole costs of $3.5 million and $11.4 million, respectively. Depreciation, depletion depletion n. when a natural resource (particularly oil) is being used up. The annual amount of depletion may, ironically, provide a tax deduction for the company exploiting the resource because if the resource they are exploiting runs out, they will no longer be able and amortization increased as a result of a higher cost basis on existing properties and new properties that began producing after the third quarter of 1996. General and administrative expenses decreased by $543,000 or 25%, and $739,000 or 13%, for the three and nine months ended September 30, 1997. The decrease in general and administrative expenses included a decrease in salary expense of $182,000 or 23%, and $516,000 or 12% for the three and nine months ended September 30, 1997, respectively. Legal fees decreased $714,000 or 56%, and $639,000 or 22% for the three and nine months respectively. Legal expense includes charges for the Phillips Phil·lips A trademark used for a screw with a head having two intersecting perpendicular slots and for a screwdriver with a tip shaped to fit into these slots. litigation of $197,000 and $1.5 million for the three and nine months ended September 30, 1997, respectively. Total revenues were $13.5 million for the third quarter and $47.7 million for the nine months ended September 30, 1997. This compares with third quarter 1996 revenues of $15.8 million and nine months 1996 revenues of $52.7 million. Natural gas sales revenue decreased $2.8 million, or 27%, and $7.0 million, or 20%, for the three and nine months ended September 30, 1997, respectively, when compared to the same periods in 1996 caused primarily by lower natural gas production. Natural gas production from South Pass Block 89 Platform B decreased 344,000 Mcf and 1.0 Bcf for the three and nine months ended September 30, 1997, respectively, as production from Well B-20 experienced anticipated declines. Two additional events occurring during August caused additional production declines during the third quarter. First, production was curtailed for ten days in August for planned work on the processing plant and second, gas delivered to Texas Eastern Corporation under the Company's long term contract was reduced in order to work off an imbalance imbalance /im·bal·ance/ (im-bal´ans) 1. lack of balance, such as between two opposing muscles or between electrolytes in the body. 2. dysequilibrium (2). . The imbalance had accumulated ac·cu·mu·late v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates v.tr. To gather or pile up; amass. See Synonyms at gather. v.intr. To mount up; increase. during the first half of the year because the Company delivered more than 80% of the Sellers' Delivery Capacity of gas well gas to Texas Eastern Corporation. Natural gas production from South Texas increased 112,000 Mcf and 180,000 Mcf for the three and nine months ended September 30, 1997, respectively which offset the lower gas sales revenue by $253,000 and $447,000 respectively. Higher average spot prices for the quarter also partially offset the lower gas sales revenue. Oil sales revenue increased $506,000 or 11%, and $2.1 million, or 16%, for the three and nine months ended September 31, 1997, respectively, when compared to the same periods in the prior year. Oil production increased by 68,000 barrels in the third quarter and by 159,000 barrels in the first nine months. Oil production from new wells on Moselle Moselle, department, France Moselle (mōzĕl`), department (1990 pop. 1,011,400), NE France, bordering on Luxembourg and Germany. Metz is the capital. Dome dome, a roof circular or (rarely) elliptical in plan and usually hemispherical in form, placed over a circular, square, oblong, or polygonal space. Domes have been built with a wide variety of outlines and of various materials. and the Smith properties accounted for 43,000 and 60,000 barrels for the three and nine months ended September 30, 1997, respectively. The remaining increase came from the three platforms in South Pass Blocks 86, 87 and 89 and West Delta Block 128. Lower average prices for both the three and nine months partially offset the increased oil production. Cash flow from operating activities for the first nine months of 1997 decreased by $4.4 million to $22.3 million, constituting a 17% decrease when compared to $26.8 million for the first nine months of 1996. The increased production from the Smith properties initiated in August was not sufficient to offset the decline caused by the partial shutdown shut·down n. A cessation of operations or activity, as at a factory. shutdown Noun the closing of a factory, shop, or other business Verb shut down of the South Pass Production facilities, the reduced volumes associated with the B-20 well at South Pass 89 and the gas imbalance. Box Energy Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on NMS See NetWare Management System. : BOXXA and BOXXB and PCX (1) A bitmapped graphics file format that handles monochrome, 2-bit, 4-bit, 8-bit and 24-bit color and uses RLE to achieve compression ratios of approximately 1.1:1 to 1.5:1. Images with large blocks of solid colors compress best under the RLE method. See PC Paintbrush. symbol: BXCA.P and BXCB.P) is an independent oil and gas exploration and production company with headquarters in Dallas, Texas “Dallas” redirects here. For other uses, see Dallas (disambiguation). The City of Dallas (pronounced [ˈdæl.əs] or [ˈdæl. . -0-
Box Energy Corporation
Condensed Statements of Income
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended
September 30,
1997 1996
------------ ----------
Revenues
Oil sales $ 5,011 $ 4,505
Gas sales 7,436 10,203
Interest income 556 551
Gain (loss) investment 35 -
Other income 437 564
--------- ------------
Total revenues 13,475 15,823
--------- ------------
Costs and expenses
Operating costs and expenses 1,032 922
Transportation expense 673 622
Net Profits Interest expense 1,883 2,182
Exploration expenses 2,617 5,725
Depreciation, depletion and amortization 5,587 4,877
General and administrative 1,603 2,146
Legal expense 558 1,272
Reorganization expense 6,434 1,934
Interest and financing expense 1,394 1,231
--------- ------------
Total costs and expense 21,781 20,911
--------- ------------
--------- ------------
Income (loss) before taxes (8,306) (5,088)
--------- ------------
Income tax expense (benefit) (725) (1,950)
--------- ------------
Net income (loss) $ (7,581) $ (3,138)
========= ============
--------- ------------
Primary earnings per share $ (0.37) $ (0.15)
========= ============
Weighted average shares outstanding
Class A Voting 3,219 3,250
Class B Non-voting 17,088 17,553
--------- ------------
Total 20,307 20,803
========= ============
Production:
Oil (MBbls) 296 228
Natural Gas (MMcf) 1,597 1,888
Average Prices:
Oil (per barrel) $ 16.90 $ 19.77
Natural Gas (per Mcf) $ 4.65 $ 5.40
Nine Months Ended
September 30,
1997 1996
------------ ------------
Revenues
Oil sales $ 15,544 $ 13,410
Gas sales 28,842 35,863
Interest income 1,702 1,721
Gain (loss) investment 30 (76)
Other income 1,551 1,839
---------- ------------
Total revenues 47,669 52,757
---------- ------------
Costs and expenses
Operating costs and expenses 2,751 3,037
Transportation expense 2,081 1,851
Net Profits Interest expense 6,588 9,241
Exploration expenses 6,523 17,878
Depreciation, depletion and amortization 17,741 13,058
General and administrative 5,030 5,769
Legal expense 2,275 2,914
Reorganization expense 7,072 1,934
Interest and financing expense 3,845 3,676
---------- ------------
Total costs and expense 53,906 59,358
---------- ------------
---------- ------------
Income (loss) before taxes (6,237) (6,601)
---------- ------------
Income tax expense (benefit) - (2,407)
---------- ------------
Net income (loss) $ (6,237) $ (4,194)
========== ============
---------- ------------
Primary earnings per share $ (0.30) $ (0.20)
========== ============
Weighted average shares outstanding
Class A Voting 3,238 3,250
Class B Non-voting 17,341 17,553
---------- ------------
Total 20,579 20,803
========== ============
Production:
Oil (MBbls) 853 694
Natural Gas (MMcf) 5,535 6,123
Average Prices:
Oil (per barrel) $ 18.22 $ 19.33
Natural Gas (per Mcf) $ 5.21 $ 5.86
-0-
Box Energy Corporation
Condensed Statements of Cash Flows
(Unaudited)
(In thousands)
Nine Months Ended
September 30,
1997 1996
----------- ---------
Cash flow provided by operations
Net income (loss) $ (6,237) $ (4,194)
Depreciation, depletion and amortization 17,741 13,058
Amortization of deferred charges 196 196
Amortization premium on marketable
securities 29 13
Deferred income tax (benefit) expense - (2,407)
Dry hole and impaired property costs 3,823 15,226
Decrease in accounts receivable 2,497 1,859
Decrease (increase) in prepaid expenses
and other current assets 495 (756)
Increase in accounts payable and
accrued expenses 3,719 3,778
Loss on sale of properties 69 6
----------- ------------
Net cash flow provided by operations 22,332 26,779
----------- ------------
Cash from investing activities
Payments for capital expenditures (27,276) (31,290)
Sales and maturities of marketable
securities 10,216 17,020
Investment in marketable securities (597) (21,186)
Notes receivable - Box Brothers
Holding Company (7,250) -
Principal repayments - Box Brothers
Holding Company 486 -
Repurchase common stock (3,465) -
Proceeds from property sales 289 82
----------- ------------
Net cash used in investing activities (27,597) (35,374)
----------- ------------
Cash from financing activities
Proceeds from notes payable 7,000 -
Payments on notes payable (1,000) -
----------- ------------
Net cash from financing activities 6,000 -
----------- ------------
Net increase (decrease) in cash and
cash equivalents 735 (8,595)
Cash and cash equivalents at
beginning of period 2,997 21,644
----------- ------------
----------- ------------
Cash and cash equivalents at end of period $ 3,732 $ 13,049
=========== ============
CONTACT: Box Energy Corporation James A. Watt 214-890-8060 |
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