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ENSERCH REPORTS 1991 RESULTS; BOARD DECLARES DIVIDEND

 ENSERCH REPORTS 1991 RESULTS; BOARD DECLARES DIVIDEND
 DALLAS, Feb. 11 /PRNewswire/ -- ENSERCH Corporation's (NYSE: ENS) 1991 income from continuing operations was $19 million versus $81 million for 1990. After-tax gains from asset sales totaled $10 million in 1991 versus $42 million in 1990. Also, 1990 benefited $19 million from settlements with the Internal Revenue Service. These amounts account for the majority of the year-to-year difference. After provision for preferred stock dividends, earnings applicable to common stock in 1991 were $4.8 million, or $.07 per share, compared with $89 million, or $1.36 per share, in 1990. These 1990 results also included income of $21 million ($.33 per share) associated with discontinued operations. Average common and dilutive common equivalent shares outstanding were 65 million for both years. Operating income for 1991 was $133 million versus $156 million for 1990. Revenues in 1991 were $2.8 billion, about the same as the year earlier.
 Net cash flows from continuing operating activities in 1991 were $224 million, compared with $42 million for 1990. The improvement came from a significant reduction in working capital as Ebasco generated cash in 1991 but required cash in 1989 and 1990. Additionally, gas-producer settlement payments, net of recoveries, of $7 million in 1991 were $13 million less than in 1990. Net cash flows from operating activities in 1991 were adequate to cover net investments and dividends for the year, and virtually no additional debt was incurred.
 In a meeting today, the ENSERCH board of directors declared a regular quarterly dividend of 20 cents per share of common stock payable March 2, 1992, to shareholders of record Feb. 21, 1992. This will be the 191st consecutive quarterly cash dividend paid by ENSERCH.
 Improved performance from the natural gas transmission and distribution business was overshadowed by declining earnings in petroleum exploration and production and engineering and construction. In addition to warmer-than-normal weather in the first quarter and substantially lower oil and gas prices, 1991 results also were affected by approximately $30 million in loss provisions on Ebasco construction projects undertaken in prior years, which have been essentially completed. The 1991 impact of Humphreys & Glasgow International on income before interest and income tax was negative by $12 million. Last Friday it was announced that the offshore business of H&G had been sold for approximately 15.5 million pounds sterling (about $28 million).
 Full-year 1991 results included a $4 million after-tax gain on the sale of ENSERCH's exploration and production properties in the Netherlands sector of the North Sea and a $6 million gain from the sale of Lone Star Gas Company's Oklahoma properties. Full-year 1990 results included after-tax gains totaling $83 million from the sale of the corporation's 50 percent interest in Losinger, a Swiss engineering and construction company; the sale of ENSERCH's investment in Oceaneering International, Inc.; income associated with discontinued operations; and a favorable income impact from settlements with the Internal Revenue Service.
 For the fourth quarter of 1991, net income was $3.9 million, compared with $46 million for the 1990 period. Earnings applicable to common stock were $507,000, or $.01 per share, compared with $43 million, or $.66 per share, for the year-earlier quarter. Operating income was $35 million versus $55 million for the year-ago period. Fourth-quarter revenues were $796 million, even with the 1990 fourth quarter. Fourth-quarter results in 1991 included the $4.0 million gain on the North Sea property sale. In the fourth quarter of 1990, there was the $20 million gain on the sale of Losinger.
 The following table indicates contributions to operating income by each of the corporation's business segments:
 ENSERCH CORPORATION
 OPERATING INCOME (LOSS) OF MAJOR BUSINESS SEGMENTS
 (Excludes general corporate expenses)
 (In thousands)
 Three Months Year
 Periods ended Dec. 31; 1991 1990 1991 1990
 Natural gas transmission
 & distribution $35,458 $30,662 $115,516 $105,696
 Petroleum exploration
 & production $10,541 $33,796 $ 32,121 $ 56,810
 Engineering &
 construction $(6,950) $(4,038) $ 899 $ 11,725
 For the year 1991, the natural gas transmission and distribution segment's total system throughput amounted to 528 billion cubic feet (Bcf), a 10 percent increase from 1990. Lone Star Gas Company's sales volumes to residential and commercial customers were 5 percent higher, primarily the result of better heating weather in 1991 vs. 1990, although heating degree days in both years were well below normal. Aggregate volumes sold to industrial and electric-generation customers of 163 Bcf were about the same as in 1990. Almost 70 percent of these sales was made by the segment's marketing affiliates. Segment transportation volumes were at a record 299 Bcf, compared with 253 Bcf in 1990.
 In the petroleum exploration and production segment, the average price per barrel of oil sold was $20.31, 9 percent lower than 1990, and volumes also decreased 9 percent versus the year earlier. Natural gas liquids sales volumes declined 5 percent, and the average sales price per barrel fell slightly to $14.23. The average natural-gas sales price in 1991 of $1.76 per thousand cubic feet (Mcf) was down from the 1990 average level of $1.85 per Mcf, and sales volumes decreased 7 percent.
 ENSERCH reserves at Jan. 1, 1992, were 1.17 trillion cubic feet (Tcf) of gas, slightly below the 1.24 Tcf a year earlier. The sharply reduced capital expenditure level in 1991 precluded additional drilling necessary to replace gas produced during the year. Oil and condensate reserves, including natural gas liquids attributable to leasehold interests, increased 24 percent to 40 million barrels (MMBbls) from the year-ago level of 32.3 MMBbls. Estimates of natural gas liquids reserves associated with the contractual rights that Enserch Exploration, Inc. has to process natural gas through its plants were essentially unchanged at 28.4 MMBbls. All reserves are estimated by DeGolyer and MacNaughton, independent petroleum consultants.
 Estimated future net cash flows, before income taxes, from ENSERCH's proved owned oil and gas reserves at Jan. 1, 1992, (based on December 1991 average prices) were $2.1 billion, compared with $2.7 billion for the year earlier. The decline is primarily attributable to lower average prices of natural gas in December 1991 versus 1990. The net present value of such cash flows, before taxes and discounted at 10 percent, was $1.1 billion versus $1.3 billion for the year-ago period.
 The margin between the SEC-prescribed cost-center ceiling under the full-cost accounting method and the unamortized capitalized costs of U.S. oil and gas properties was about $88 million at Dec. 31, 1991. Product prices, production rates, levels of reserves and estimates of future development costs all influence the calculation of the cost- center ceiling, making it difficult to project. However, prices for natural gas have declined sharply since the end of 1991. If there is not substantial improvement in prices or mitigating changes in the other factors involved in the calculation by the end of the first quarter, the carrying value of the corporation's oil and gas properties almost certainly will be above the SEC-prescribed cost-center ceiling, which would necessitate a writedown and a noncash charge against earnings at that time.
 The decline in the engineering and construction segment's operating income was due to the loss provisions recorded by Ebasco and Humphreys & Glasgow already mentioned. In addition, income levels were affected negatively by projects and awards being canceled, delayed or drawn out because of the economic recession and related cutbacks in both the U.S. and U.K.
 Ebasco's year-end 1991 backlog was $1.2 billion, down from $1.5 billion at year-end 1990. Both years exclude amounts relating to the New Production Reactor project of the U.S. Department of Energy, which was carried last year at $700 million, a project that now has been delayed indefinitely. About one-half of Ebasco's backlog is for construction work, with the balance for professional services.
 Fourth-quarter results for the natural gas transmission and distribution segment reflected improved sales by marketing affiliates and greater volumes sold to Lone Star's electric-generation customers who increased their gas takes to meet contract requirements by year-end. The petroleum exploration and production segment reported a decrease in operating income, the result of dramatically lower product prices. In the engineering and construction segment, $25 million of the loss provisions were recorded in the fourth-quarter and are the primary cause of the poor comparison.
 ENSERCH Corporation is a diversified energy, engineering and construction company.
 ENSERCH CORPORATION AND SUBSIDIARY COMPANIES
 SUMMARY OF OPERATIONS
 (In thousands except per share amounts)
 Three Months Ended Dec. 31; 1991 1990
 Revenues $795,568 $793,087
 Operating income $ 34,860 $ 54,511
 Income from continuing operations $ 3,914 $ 34,258
 Income from discontinued operations $ -- $ 12,059
 Net income $ 3,914 $ 46,317
 Earnings applicable to common stock $ 507 $ 42,654
 Net cash flows from continuing
 operating activities $ 98,063 $ 14,703
 Earnings per share of common stock
 Income from continuing operations $ .01 $ .47
 Income from discontinued operations $ -- $ .19
 Total $ .01 $ .66
 Average common and dilutive common
 equivalent shares outstanding 65,223 65,038
 ENSERCH CORPORATION AND SUBSIDIARY COMPANIES
 SUMMARY OF OPERATIONS
 (In thousands except per share amounts)
 Twelve Months Ended Dec. 31; 1991 1990
 Revenues $2,834,673 $2,815,081
 Operating income $ 133,054 $ 155,927
 Income from continuing operations $ 19,065 $ 81,370
 Income from discontinued operations $ -- $ 21,426
 Net income $ 19,065 $ 102,796
 Earnings applicable to common stock $ 4,765 $ 88,583
 Net cash flows from continuing
 operating activities $ 224,414 $ 41,701
 Earnings per share of common stock
 Income from continuing operations $ .07 $ 1.03
 Income from discontinued operations $ -- $ .33
 Total $ .07 $ 1.36
 Average common and dilutive common
 equivalent shares outstanding 65,074 65,023
 -0- 2/11/92
 /NOTE TO EDITORS: Correct styles are ENSERCH Corporation and Enserch Exploration, Inc./
 /CONTACT: Crystal Bell of ENSERCH, 214-670-2528/
 (ENS) CO: ENSERCH Corporation ST: Texas IN: OIL SU: ERN DIV


JT -- NY064 -- 8931 02/11/92 16:01 EST
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