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ENSERCH ADOPTS NEW STRATEGY TO CONCENTRATE ON INTEGRATED NATURAL GAS BUSINESS; 1992 EARNINGS REDUCED BY UNUSUAL CHARGES;

 DALLAS, Feb. 10 /PRNewswire/ -- ENSERCH Corporation (NYSE: ENS) announced today that its board of directors has endorsed a new focused strategy to concentrate the company's resources on serving the growing natural gas market from wellhead to end use. To implement the program and strengthen ENSERCH's balance sheet, the board approved a sweeping series of actions.
 Announced today were:
 -- William C. McCord, chairman and chief executive officer, will retire at age 65 on April 30. David W. Biegler, president, will succeed McCord, adding the titles of chairman and chief executive officer.
 -- Ebasco Services Incorporated, ENSERCH's engineering and construction subsidiary, is being offered for sale, with proceeds earmarked for strengthening ENSERCH's balance sheet.
 -- A quarterly dividend on common shares of 5 cents per share, payable March 1 to holders of record February 19, was declared. The previous quarterly dividend was 20 cents.
 -- The company's capital expenditure budget for exploration and production in 1993 has been increased by $20 million to $112 million compared with $67 million spent in 1992. Efforts will be concentrated on increasing natural gas production from the company's extensive reserves in East Texas.
 -- ENSERCH, in a separate release, announced that several unusual and extraordinary items totaling $52 million, or $.79 per share, caused a net loss for 1992 of $28 million, compared to $19 million of net income in 1991. After provision for preferred dividends, the loss applicable to common shares was $41 million, or $.62 per share, compared to earnings of $4.8 million, or $.07 per share in 1991.
 -- ENSERCH will consolidate certain functions to further reduce costs.
 McCord Praised for Contributions to Company
 Commenting on the current chairman and chief executive's retirement, Biegler said, "Although Bill McCord reaches normal retirement age of 65 in April, his long tenure with our company will be of continuing value as he is expected to remain a member of the Board of Directors after his retirement. His support and encouragement have been essential in hammering out our new strategy to capitalize on our current strengths in natural gas."
 Biegler, 46, a veteran of 26 years with the company, was elected president in September, 1991. McCord has been with ENSERCH 43 years, the past 22 as chief executive officer.
 Biegler Discusses New Strategy, Provides More Detail
 "We are focusing on being a fully integrated natural gas company, allowing us to serve our shareholders and customers better than as a diversified energy company," David Biegler said. "We are committed to seeking the highest value and best use for our product -- natural gas -- and to enhancing shareholder value through this focus."
 Biegler said ENSERCH's existing vertical integration means the company can move natural gas from wellhead to end use, including exploration, production, gathering, transportation, liquids extraction, and burner-tip sales to residential, commercial, industrial and power generation customers. "We intend to be a major factor in these and other growing and increasingly important markets for gas."
 The strategy includes increased focus on the company's exploration and production business. "Our existing projects, including the major development program on Garden Banks Block 388 in the Gulf of Mexico, provide us with an oil balance," he said. "We will be concentrating resources on further development of our large gas reserves."
 Ebasco for Sale
 "Ebasco, our engineering and construction subsidiary, is a real jewel," Biegler said, "However, it doesn't fit our new strategy."
 "We have concluded that an open sale is the best method of achieving for ENSERCH the true value of Ebasco in the marketplace. Ebasco experienced a successful year in 1992. Because of this strong performance and the enhanced outlook, evidenced by the increase in backlog to $1.6 billion, we expect it will command a price that will considerably strengthen our balance sheet and enhance earnings."
 "Our commitment to Ebasco's clients and employees is that the purchaser must be fully qualified to own a company such as Ebasco and to assure perpetuation of its outstanding record of excellence. ENSERCH is prepared to continue its ownership if such a qualified buyer is not secured at an acceptable price and within a reasonable time," Biegler said.
 Biegler said a private offering memorandum will be available in several weeks through Morgan Stanley & Co. and James D. Wolfensohn Inc., who have been engaged to represent ENSERCH in the transaction.
 Earnings Reduced by Unusual Charges
 The results for 1992 were marked by several unusual and extraordinary charges that reduced 1992 earnings by $52 million or $.79 per share.
 -- Cost of debt restructuring, to improve results after 1992
 -- Writedown of an idle pipeline and shallow-water production facility from an abandoned offshore project
 -- A reserve for litigation
 -- Charges relating to the 1992 disposition of the company's UK engineering and construction company
 -- A charge relating to London and Houston real estate, formerly utilized by discontinued businesses
 The actions taken in 1992 are expected to result in annual savings of about $.33 per share in 1993 and some $.38 per share annually thereafter. Further enhancements to results are anticipated following the successful sale of Ebasco.
 The year's results were impacted by warm weather and depressed natural gas prices early in the year. Heating degree days for 1992 were 9 percent below the year earlier and 18 percent below normal. However, Ebasco produced sharply higher results.
 Cash generated for the year was adequate to meet capital spending and dividends, to reduce debt by $12 million and to provide funds for temporary cash investments of $31 million.
 Full details are given in a separate release dated February 10, 1993.
 Dividend Reduced
 "We are determined to further strengthen our balance sheet and provide the needed funds for our increased exploration and production investments without waiting on the sale of Ebasco," Biegler said. "Reducing the dividend now is a reflection of that determination, and we are confident that taking this prudent step, together with our action plan, will serve our shareholders well over the longer term with better results, improved shareholder values and stronger credit ratings."
 ENSERCH Corporation is a Dallas-based integrated natural gas company.
 -0- 2/10/93
 /NOTE TO EDITORS: Correct style is ENSERCH Corporation./
 /CONTACT: Crystal Bell for ENSERCH Corporation, 214-670-2528/


CO: Enserch Corporation ST: Texas IN: OIL SU:

LR -- NY016 -- 5001 02/10/93 08:42 EST
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Date:Feb 10, 1993
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