| (Mark one) | |
| [ X ] | Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended June 30, 2004 |
| [ ] | Transition Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Transition Period from .......... to .......... |
Commission File Number .......... 1-12508
MAGNUM HUNTER
RESOURCES, INC.
Exact name of registrant as specified in its charter
| Nevada | 87-0462881 | |
|---|---|---|
| State or other jurisdiction of incorporation or organization |
IRS employer identification No. |
600 East Las Colinas
Blvd., Suite 1100, Irving, Texas 75039
Address of principal
executive offices
(972)
401-0752
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 [ ]
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).
Yes [ X ] No [ ]
State the number of shares outstanding of each of the issuer's classes of common equity, as of July 23, 2004: 86,755,682.
| June 30, | December 31, | |||||||
|---|---|---|---|---|---|---|---|---|
| 2004 |
2003 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | $ | 13,941 | $ | 18,693 | ||||
| Accounts receivable - trade, net of allowance of $4,348 and $4,331 | ||||||||
| respectively | 59,106 | 46,716 | ||||||
| Deferred income taxes, current | 9,998 | 8,263 | ||||||
| Deposits | 1,113 | 2,713 | ||||||
| Land held for sale | 6,067 | 7,563 | ||||||
| Prepaid drilling costs | 7,220 | 8,770 | ||||||
| Other current assets | 12,638 | 7,619 | ||||||
| Total Current Assets | 110,083 | 100,337 | ||||||
| Property, Plant, and Equipment | ||||||||
| Oil and gas properties, full cost method | ||||||||
| Unproved | 101,660 | 110,467 | ||||||
| Proved | 1,426,591 | 1,292,388 | ||||||
| Gas processing plants and pipelines | 34,416 | 34,149 | ||||||
| Other property | 9,643 | 7,805 | ||||||
| Total Property, Plant and Equipment | 1,572,310 | 1,444,809 | ||||||
| Accumulated depreciation, depletion, amortization and impairment | (400,558 | ) | (348,926 | ) | ||||
| Net Property, Plant and Equipment | 1,171,752 | 1,095,883 | ||||||
| Other Assets | ||||||||
| Deferred financing costs and other | 14,305 | 13,205 | ||||||
| Acquisition escrow | 12,000 | -- | ||||||
| Goodwill | 56,467 | 56,467 | ||||||
| Total Assets | $ | 1,364,607 | $ | 1,265,892 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current Liabilities | ||||||||
| Trade payables and other current liabilities | $ | 16,218 | $ | 19,950 | ||||
| Accrued interest | 8,682 | 8,909 | ||||||
| Other accrued liabilities | 40,190 | 28,873 | ||||||
| Revenues payable | 8,102 | 7,860 | ||||||
| Suspended revenue payable | 16,425 | 16,049 | ||||||
| Derivative liabilities, current | 26,975 | 21,853 | ||||||
| Current maturities of long-term debt | 3,103 | 2,009 | ||||||
| Total Current Liabilities | 119,695 | 105,503 | ||||||
| Long-Term Liabilities | ||||||||
| Long-term debt, less current maturities | 458,395 | 595,503 | ||||||
| Asset retirement obligations | 35,768 | 32,489 | ||||||
| Derivative liabilities, non-current | 6,072 | 1,198 | ||||||
| Deferred income taxes payable | 162,182 | 141,000 | ||||||
| Other non-current liabilities | 432 | 523 | ||||||
| Stockholders' Equity | ||||||||
| Preferred stock - $.001 par value; 10,000,000 shares authorized, 216,000 | ||||||||
| designated as Series A; 80,000 issued and outstanding, liquidation amount $0 | 1 | 1 | ||||||
| Common Stock - $.002 par value; 200,000,000 shares authorized, | ||||||||
| 88,402,746 and 71,977,759 shares issued, respectively | 177 | 144 | ||||||
| Additional paid-in capital | 584,915 | 429,446 | ||||||
| Accumulated other comprehensive loss | (19,183 | ) | (13,576 | ) | ||||
| Retained earnings | 47,495 | 5,003 | ||||||
| Common stock in deferred compensation plan, at cost (34,416 shares) | (192 | ) | (192 | ) | ||||
| Unearned common stock in KSOP, at cost (1,012,203 shares) | (6,110 | ) | (6,110 | ) | ||||
| 607,103 | 414,716 | |||||||
| Treasury stock, at cost (3,942,294 shares) | (25,040 | ) | (25,040 | ) | ||||
| Total Stockholders' Equity | 582,063 | 389,676 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 1,364,607 | $ | 1,265,892 | ||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| Three Months Ended June 30, |
Six Months Ended June 30, | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2004 |
2003 |
2004 |
2003 | |||||||||||
| Operating Revenues: | ||||||||||||||
| Oil and gas sales | $ | 97,913 | $ | 68,470 | $ | 186,730 | $ | 138,060 | ||||||
| Gas gathering, marketing and processing | 10,310 | 9,055 | 19,836 | 18,440 | ||||||||||
| Oil field services | 1,813 | 913 | 3,848 | 1,992 | ||||||||||
| Total Operating Revenues | 110,036 | 78,438 | 210,414 | 158,492 | ||||||||||
| Operating Costs and Expenses: | ||||||||||||||
| Oil and gas production lifting costs | 15,130 | 13,498 | 28,158 | 26,446 | ||||||||||
| Production taxes and other costs | 9,583 | 7,930 | 17,948 | 17,107 | ||||||||||
| Gas gathering, marketing and processing | 7,338 | 6,882 | 13,918 | 13,428 | ||||||||||
| Oil field services | 904 | 593 | 2,344 | 1,450 | ||||||||||
| Depreciation, depletion, amortization and accretion | 27,645 | 24,978 | 53,125 | 46,502 | ||||||||||
| Loss (Gain) on sale of assets | 50 | (46 | ) | (148 | ) | (140 | ) | |||||||
| General and administrative | 4,423 | 3,159 | 9,498 | 6,341 | ||||||||||
| Total Operating Costs and Expenses | 65,073 | 56,994 | 124,843 | 111,134 | ||||||||||
| Operating Profit | 44,963 | 21,444 | 85,571 | 47,358 | ||||||||||
| Equity in losses of affiliate | -- | (525 | ) | -- | (237 | ) | ||||||||
| Other income | 2,004 | 260 | 2,226 | 378 | ||||||||||
| Costs associated with early retirement of debt | -- | (2,211 | ) | -- | (4,066 | ) | ||||||||
| Non-cash hedging adjustments | 370 | 167 | 464 | 536 | ||||||||||
| Interest expense | (9,659 | ) | (12,384 | ) | (19,316 | ) | (24,962 | ) | ||||||
| Income Before Income Tax | 37,678 | 6,751 | 68,945 | 19,007 | ||||||||||
| Provision for income tax expense | ||||||||||||||
| Current | (395 | ) | -- | (772 | ) | -- | ||||||||
| Deferred | (14,053 | ) | (2,581 | ) | (25,681 | ) | (7,246 | ) | ||||||
| Total Provision for Income Tax Expense | (14,448 | ) | (2,581 | ) | (26,453 | ) | (7,246 | ) | ||||||
| Income Before Cumulative Effect of a Change in Accounting Principle | 23,230 | 4,170 | 42,492 | 11,761 | ||||||||||
| Cumulative effect of a change in accounting principle, | ||||||||||||||
| net of income tax expense of $244 | -- | -- | -- | 399 | ||||||||||
| Net Income | $ | 23,230 | $ | 4,170 | $ | 42,492 | $ | 12,160 | ||||||
| Income per Common Share - Basic | ||||||||||||||
| Income before cumulative effect of a change in accounting principle | $ | 0.34 | $ | 0.06 | $ | 0.62 | $ | 0.17 | ||||||
| Cumulative effect of a change in accounting principle . | -- | -- | -- | 0.01 | ||||||||||
| Income per Common Share - Basic | $ | 0.34 | $ | 0.06 | $ | 0.62 | $ | 0.18 | ||||||
| Income per Common Share - Diluted | ||||||||||||||
| Income before cumulative effect of a change in accounting principle | $ | 0.33 | $ | 0.06 | $ | 0.61 | $ | 0.17 | ||||||
| Cumulative effect of a change in accounting principle | -- | -- | -- | 0.01 | ||||||||||
| Income per Common Share - Diluted | $ | 0.33 | $ | 0.06 | $ | 0.61 | $ | 0.18 | ||||||
| Common Shares Used in Per Share Calculation | ||||||||||||||
| Basic | 68,515,992 | 65,937,569 | 68,098,785 | 66,321,403 | ||||||||||
| Diluted | 70,335,105 | 66,894,623 | 69,857,798 | 67,114,375 | ||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| Preferred Stock |
Common Stock |
Treasury Stock |
Additional Paid in Capital |
Retained Earnings |
Deferred Compensation |
Unearned Shares in KSOP |
Accumulated Other Comprehensive Income (Loss) |
Total Stockholders' Equity |
Total Comprehensive Income (Loss) | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Balance at December 31, 2003 | $ | 1 | $ | 144 | $ | (25,040 | ) | $ | 429,446 | $ | 5,003 | $ | (192 | ) | $ | (6,110 | ) | $ | (13,576 | ) | $ | 389,676 | ||||||||||
| Issuance of 1,425 shares of common stock pursuant to | ||||||||||||||||||||||||||||||||
| employee stock option plan | 3 | 6,171 | 6,174 | |||||||||||||||||||||||||||||
| Deferred tax benefit on exercise of employee stock | ||||||||||||||||||||||||||||||||
| options | 2,072 | 2,072 | ||||||||||||||||||||||||||||||
| Stock compensation | 59 | 59 | ||||||||||||||||||||||||||||||
| Issuance of 15,000 shares of common stock pursuant to | ||||||||||||||||||||||||||||||||
| public offering | 30 | 147,167 | 147,197 | |||||||||||||||||||||||||||||
| Net Income | 42,492 | 42,492 | $ | 42,492 | ||||||||||||||||||||||||||||
| Reclassification adjustment related to derivative | ||||||||||||||||||||||||||||||||
| contracts, net of income tax expense of $6,580 | 10,793 | |||||||||||||||||||||||||||||||