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TRANSCO ANNOUNCES FOURTH QUARTER, YEAR-END RESULTS

 TRANSCO ANNOUNCES FOURTH QUARTER, YEAR-END RESULTS
 HOUSTON, Feb. 4 /PRNewswire/ -- Transco Energy Company (NYSE: E)


today reported a net loss for the quarter ended Dec. 31, 1991, of $145.9 million, or $4.97 per share, compared with a net loss of $11.6 million, or $0.40 per share, for the fourth quarter of 1990.
 The 1991 results include an after-tax charge of $149.2 million, or $5.08 per share, primarily for the previously announced costs associated with the company's restructuring. Excluding the charge, the net income for the quarter was $3.3 million, or $0.11 per share.
 Last year's results include a charge of $34.0 million, or $1.18 per share, for certain litigation and regulatory issues and a benefit of $6.1 million, or $0.21 per share, from a rate settlement. Excluding these items, net income for 1990s fourth quarter was $16.3 million, or $0.57 per share. Excluding the items described above, the decline in earnings was due primarily to increased interest expense.
 Fourth Quarter Results Before Selected Items
 Absent the selected charges and benefits, the pipeline segment earnings for the fourth quarter of 1991 were $23.0 million, compared with $31.2 million a year ago. Transcontinental Gas Pipe Line Corporation's net income was $14.7 million, down from $17.8 million, while Texas Gas Transmission Corporation reported net income of $8.2 million versus $10.6 million in the fourth quarter of 1990. The decline in earnings was primarily attributable to higher interest expense at TGPL and increased operating expenses and lower earnings from a pipeline affiliate at Texas Gas.
 Excluding the selected charges, the marketing segment posted net income of $2.6 million for the quarter, down from $3.5 million a year ago, due primarily to higher operating expenses and higher net interest expense. Excluding the selected charges, the power generation segment recorded a net loss of $1.4 million, compared with 1990 earnings of $0.1 million, due primarily to start-up costs associated with various power projects.
 Excluding the selected charges, the oil and gas segment lost $1.2 million, compared with losses of $2.0 million a year ago, while the coal operations lost $0.2 million, down from earnings of $0.1 million a year ago.
 Full Year 1991 Results
 For the full year, Transco reported a net loss of $193.1 million, or $6.58 per share, compared with net income of $15.4 million, or $0.53 per share, for 1990. Including the charge referred to above, 1991 results include net after-tax charges totalling $212.5 million, or $7.24 per share. Excluding these items, net income for the year was $19.4 million, or $0.66 per share.
 The 1990 results included a net after-tax charge of approximately $26.8 million, or $0.92 per share, for various litigation, regulatory and rate issues. Excluding these items, 1990's net income was $42.2 million, or $1.45 per share.
 President and Chief Executive Officer John P. DesBarres said, "For Transco, 1991 was a difficult year in which the company witnessed more change than perhaps at any other time in its history. We do not believe that the fourth quarter results -- even excluding the charges taken -- are indicative of Transco's future earnings potential. The elements of the strategic plan announced late last year are the cornerstones to restoring Transco's financial strength, and we are pleased to have already completed several significant steps of that plan. This year will see the continued implementation of the plan, with a strong focus on earnings improvement, especially from our core businesses."
 Transco Energy Company, through its interstate gas pipeline systems and other gas service companies, transports and sells natural gas, predominantly to markets in the eastern and midwestern United States. Transco also develops independent power generation facilities and new energy technologies; explores for and produces oil and natural gas in the Gulf of Mexico; and mines and markets coal.
 TRANSCO ENERGY COMPANY
 Unaudited Condensed Consolidated Income Statement
 (Expressed in thousands except for per share amounts)
 Periods Ended Three Months Twelve Months
 Dec. 31 1991 1990 1991 1990
 Operating revenues $793,086 $796,909 $2,738,849 $3,081,059
 Operating costs
 and expenses (947,876) (769,531) (2,811,449) (2,891,932)
 Operating income
 (loss) (154,790) 27,378 (72,600) 189,127
 Interest expense (62,223) (50,785) (234,387) (166,998)
 Other income
 (deductions) 3,070 20,631 43,642 46,991
 Income tax
 (provision) benefit 74,469 (2,389) 95,932 (27,952)
 Net income (loss) before
 preferred dividends (139,474) (5,165) (167,413) 41,168
 Preferred dividends (6,432) (6,432) (25,730) (25,730)
 Common stock equity
 in net income (loss)$(145,906)A $(11,597)B $(193,143)A,C $15,438B,D
 Primary earnings (loss)
 per share of common
 stock and common
 stock equivalents $(4.97) $(0.40) $(6.58) $0.53
 Average shares of common
 stock and common
 stock equivalents
 outstanding 29,367 28,917 29,335 29,023
 (A) Includes $149.2 million charge for restructuring costs.
 (B) Includes $34.0 million charge for certain litigation and regulatory issues and $6.1 million benefit from a Texas Gas rate settlement.
 (C) Includes $46.7 million charge for TGPL's Transition Cost proceeding; $7.9 million charge for estimated employee severance costs; $6.3 million charge related to the settlement of certain regulatory and legal issues; $7.0 million charge related to under-recovery of producer settlement costs and $4.6 million benefit related to settlement of certain rate issues.
 (D) Includes $10.5 million charge for additional producer settlement costs that will not be recovered from customers by TGPL and $11.6 million benefit related to the approval of a Texas Gas Transmission Corporation rate case settlement.
 TRANSCO ENERGY COMPANY
 Unaudited Operating Income (Loss) By Segment
 (Expressed in millions)
 Three Months Twelve Months
 Ended Dec. 31, Ended Dec. 31,
 1991 1990 1991 1990
 Pipelines
 TGPL $(60.9) $0.3 $(8.2) $110.2
 Texas Gas 12.4 25.9 47.8 73.3
 Other (0.6) 0.6 1.5 2.2
 (49.1)(A) 26.8(B) 41.1(A,C) 185.7(B,D)
 Marketing 3.9(E) 5.1 11.4(E,F) 14.2
 Power Generation (5.7)(G) 0.5 (9.4)(G) 0.1
 Oil and Gas
 Conventional (0.7) (2.3) (5.4) (8.5)
 Coalbed Methane (103.0)(H) (1.5) (112.7)(H) (1.8)
 Coal 1.6(I) (0.1) 9.9i 7.3
 TEC and other (1.8) (1.1) (7.5) (7.9)
 $(154.8) $27.4 $(72.6) $189.1
 TRANSCO ENERGY COMPANY
 Unaudited Common Stock Equity In Net Income (Loss) By Segment
 (Expressed in Millions)
 Three Months Twelve Months
 Ended Dec. 31, Ended Dec. 31,
 1991 1990 1991 1990
 Pipelines
 TGPL $(55.3) $(16.2) $(68.6) $23.0
 Texas Gas 5.0 16.7 21.4 45.4
 Other (0.6) 2.8 1.0 2.8
 (50.9)a 3.3b (46.2)a,c 71.2b,d
 Marketing 1.9e 3.5 5.6e,f 9.9
 Power Generation (3.3)g 0.1 (4.7)g 1.0
 Oil and Gas
 Conventional (0.2) (1.1) (3.3) (5.2)
 Coalbed Methane (67.0)h (0.9) (72.4)h (1.1)
 Coal (0.3)i 0.1 4.8i 1.9
 TEC and other (26.1)j (16.6) (76.9)j (62.3)
 $(145.9) $(11.6) $(193.1) $15.4


FOOTNOTES:
 (A) Includes charges of $73.2 million pretax ($48.5 million after- tax) for regulatory and legal issues and $40.3 million pretax ($25.4 million after-tax) for restructuring costs.
 (B) Includes charge of $47.0 million pretax ($34.0 million after- tax) for regulatory and legal issues and benefit of $9.8 million pretax ($6.1 million after-tax) from a Texas Gas Reserve rate settlement.
 (C) Includes charges of $53.0 million pretax ($46.7 million after- tax) for TGPL's Transition Cost proceeding; $11.8 million pretax ($7.4 million after-tax) for estimated employee severance costs; $10.0 million pretax ($6.3 million after-tax) related to the settlement of regulatory and legal issues; and $11.1 million pretax ($7.0 million after-tax) related to the under-recovery of producer settlement costs, as well as a benefit of $7.4 million pretax ($4.6 million after-tax) related to settlement of rate issues.
 (D) Includes charge of $16.6 million pretax ($10.5 million after- tax) for additional producer settlement costs that will not be recovered from customers by TGPL and benefit of $16.1 million pretax ($11.6 million after-tax) related to the approval of a Texas Gas Transmission Corporation rate case settlement.
 (E) Includes charges of $1.0 million pretax ($0.7 million after-tax) for restructuring costs.
 (F) Includes charge of $0.7 million pretax ($0.5 million after-tax) for estimated employee severance costs.
 (G) Includes charge of $3.0 million pretax ($1.9 million after-tax) for restructuring costs.
 (H) Includes charges of $97.0 million pretax ($64.0 million after- tax) for reduction in book value and $3.0 million pretax (2.0 million after-tax) for restructuring costs.
 (I) Includes charges of $0.2 million pretax ($0.1 million after-tax) for restructuring costs.
 (J) Includes charge of $6.6 million after-tax for restructuring costs.
 TRANSCO ENERGY COMPANY
 Volumetric Information
 Three Months Twelve Months
 Ended December 31, Ended December 31,
 1991 1990 1991 1990
 Pipeline System Deliveries (Bcf)
 TGPL:
 Contract sales -- -- -- 1
 Long-haul transportation 225 230 874 888
 Market area transportation 89 77 250 222
 Total market area deliveries 314 307 1,124 1,111
 Production area deliveries 42 67 237 339
 Total system deliveries a 356 374 1,361 1,450
 (A) Includes deliveries under the FS, IFS and IS sales agreements of 60 Bcf and 58 Bcf for the three months ended Dec. 31, 1991, and 1990, respectively, and 232 Bcf and 262 Bcf for the twelve months ended Dec. 31, 1991, and 1990, respectively. Excludes sales under IS agreements of 4 Bcf and 1 Bcf for the three months ended Dec. 31, 1991, and 1990, respectively, and 10 Bcf and 10 Bcf for the twelve months ended Dec. 31, 1991 and 1990, respectively, that were not delivered by TGPL.
 TEXAS GAS:
 Sales 31 37 90 158
 Transportation for others
 Long-haul transportation 114 103 382 342
 Short-haul transportation 60 60 226 203
 Total transportation for others 174 163 608 545
 Total system deliveries 205 200 698 703
 Marketing Sales
 TEMCO:
 Gas Sales (Bcf) 89 87 343 375
 TESCO:
 Natural Gas Liquids Sales
 (million gallons) 90 68 303 209
 TXG Gas Marketing:
 Gas Sales (Bcf) 17 17 60 55
 TRANSCO ENERGY COMPANY
 Unaudited Reported/Normalized Operating Income
 And Common Stock Equity In Net Income
 (In Millions)
 Three Months Twelve Months
 Ended December 31, Ended December 31,
 1991 1990 1991 1990
 Reported Operating
 Income (Loss) $(154.8) $27.4 $(72.6) $189.1
 Selected Items:
 Restructuring Costs 144.5 -- 157.0 --
 Transition Cost
 Proceeding -- -- 53.0 --
 Producer Settlements,
 Legal And Regulatory
 Issues 73.2 37.2 86.9 37.8
 Normalized Operating
 Income $62.9 $64.6 $224.3 $226.9
 Reported Common Stock
 Equity In Net
 Income (Loss) $(145.9) $(11.6) $(193.1) $15.4
 Selected Items:
 Restructuring Costs 100.7 -- 108.6 --
 Transition Cost
 Proceeding -- -- 46.7 --
 Producer Settlements,
 Legal And
 Regulatory Issues 48.5 27.9 57.2 26.8
 Normalized Common Stock Equity
 In Net Income (Loss) $ 3.3 $16.3 $19.4 $42.2
 -0- 2/4/92
 /CONTACT: Katherine K. Putnam (media), 713-439-2455, or Donato J. Eassey (analyst), 713-439-4176, both of Transco Energy Company/
 (E) CO: Transco Energy Company ST: Texas IN: OIL SU: ERN


PS -- NY102 -- 6954 02/04/92 19:03 EST
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