DALLAS, April 3 /PRNewswire-FirstCall/ -- National Energy Group, Inc.
(OTC Bulletin Board: NEGI) today announces results for the fourth quarter
ended December 31, 2002.
Results of Operations
On September 12, 2001 as provided in the Company's Joint Plan of
Reorganization, the Company contributed all its operating assets and oil and
gas properties excluding cash of $4.3 million to NEG Holding LLC in exchange
for an initial 50% membership interest (the "LLC Contribution"). Following
the LLC Contribution, the Company no longer directly owns oil and gas
properties and will only recognize income from accretion of the preferred
investment and fees attributable to the management and operation of NEG
Holding LLC's oil and gas properties. The income from accretion of the
preferred investment and management fees amounted to $8.6 million and
$1.8 million, respectively, for the quarter ended December 31, 2002 and
$32.9 million and $7.6 million, respectively, for the year ended
December 31, 2002.
For the Three Months Ended December 31, 2002
Net income of $2.5 million was recognized for the three months ended
December 31, 2002 compared with net income of $1.8 million for the comparable
2001 period.
Total revenues increased $.8 million (8.3%) to $10.4 million for the
fourth quarter of 2002 from $9.6 million for the fourth quarter of 2001.
The Company had no oil and natural gas production during the fourth
quarter of 2002 or 2001 due to the LLC Contribution.
For the year Ended December 31, 2002
Net income of $9.4 million was recognized for the year ended
December 31, 2002 compared with net income of $37.3 million for the comparable
2001 period. The year ended December 31, 2002 includes $5.1 million in
deferred income tax expense while the twelve months ended December 31, 2001
includes a $31.6 million deferred income tax benefit.
Total revenues decreased $5.2 million (11.4%) to $40.5 million for the
year ended December 31, 2002 from $45.7 million for the year ended
December 31, 2001. The decrease in revenues was attributable to the change in
revenue recognition as a result of the LLC Contribution.
The Company had no oil and natural gas production during the year ended
December 31, 2002 due to the LLC Contribution. The Company produced 428 Mbbls
of oil and 4,333 Mmcf of natural gas during the year ended December 31, 2001.
Oil and Gas Operations
NEG Holding LLC conducts its oil and gas operations through its affiliate,
NEG Operating LLC. The Company manages all of these oil and gas operations
pursuant to a management agreement with NEG Operating LLC.
National Energy Group, Inc. is a Dallas, Texas based company.
This press release may contain projections and other forward-looking
statements within the meaning of Section 21E of the Securities Exchange Act of
1934, as amended. Any such projections or statements reflect the Company's
current views with respect to future events and financial performance. No
assurances can be given, however, that these events will occur or that such
projections will be achieved and actual results could differ materially from
those projected. A discussion of important factors that could cause actual
results to differ materially from those projected is included in the Company's
periodic reports filed with the Securities and Exchange Commission.
National Energy Group, Inc.
Summary Financial Results
(In thousands, except per share data)
Three months ended Year ended
December 31, December 31,
2001 2002 2001 2002
Production:
Oil (Mbls) (A) --- --- 428 ---
Natural gas (Mmcf) (A) --- --- 4,333 ---
Natural gas equivalent
(Mmcfe) (A) --- --- 6,901 ---
Average Sales Price:
Oil ($/Bbls) $--- $--- $27.70 $---
Natural gas ($/Mcf) --- --- 4.92 ---
Natural gas equivalent ($/Mcfe) --- --- 4.81 ---
Results of Operations Data:
Revenues:
Oil and natural gas sales $--- $--- $33,176 $---
Accretion of Investment in
NEG Holding LLC 7,524 8,567 9,834 32,879
Management fee 2,047 1,821 2,699 7,637
Total revenue 9,571 10,388 45,709 40,516
Costs and expenses:
Lease operating --- --- 3,875 ---
Oil and natural gas
production taxes --- --- 1,695 ---
Depreciation, depletion
and amortization --- --- 6,163 ---
General and administrative 1,864 1,789 5,929 7,105
Total costs and expenses 1,864 1,789 17,662 7,105
Operating income 7,707 8,599 28,047 33,411
Interest expense (4,684) (4,723) (21,224) (18,964)
Interest income and
other, net 11 19 (337) 36
Income before reorganization
items and income taxes 3,034 3,895 6,486 14,483
Reorganization items:
Professional fees and other (197) --- 237 ---
Income before income taxes 2,837 3,895 6,723 14,483
Income tax benefit (expense) (993) (1,363) 30,589 (5,068)
Income before extraordinary
charge 1,844 2,532 37,312 9,415
Extraordinary loss on
discharge of indebtedness --- --- (12) ---
Net income to common
shareholders $1,844 $2,532 $37,300 $9,415
Cash Flow Data:
Cash flow from
operations (B) $(5,197) $(5,183) $2,907 $(20,434)
Capital expenditures
(oil and natural gas) $--- $--- $27,364 $---
Per share data:
Income before extraordinary
item, basic and diluted $.15 $.23 $3.33 $.84
Loss on discharge of
indebtedness, basic and
diluted $--- $--- $(.00) $---
Net income per common share,
basic and diluted $.15 $.23 $3.33 $.84
Cash flow from operations (B) $(.46) $(.46) $.26 $(1.83)
Shares used in per share
computations:
Earnings per share,
basic and diluted 11,191 11,191 11,191 11,191
Cash flow per share,
basic and diluted 11,191 11,191 11,191 11,191
National Energy Group, Inc.
Condensed Balance Sheet
(In thousands)
Dec. 31, Dec. 31,
2001 2002
Assets
Cash, cash equivalents and marketable
securities $3,090 $3,477
Other current assets 1,376 927
Investment in NEG Holding LLC 97,654 108,880
Deferred tax asset 30,589 25,522
Total assets $132,709 $138,806
Liabilities and Stockholders' Equity (Deficit):
Current liabilities $2,792 $44,405
Credit facility 10,940 10,940
Senior notes 148,637 148,637
Long-term interest payable 42,894 ---
Deferred gain on senior note redemption 9,851 7,813
Stockholders' deficit (82,405) (72,989)
Total liabilities and stockholders' equity $132,709 $138,806
(A) The Company recorded no oil and natural gas revenue in 2002 compared
to eight months of oil and natural gas revenue in 2001 due to the LLC
Contribution.
(B) Cash flow from operations is shown before changes in working capital
accounts and excludes the extraordinary loss on discharge of
indebtedness.
SOURCE National Energy Group, Inc.
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Company News On-Call:
http://www.prnewswire.com/comp/122192.html
CONTACT:
Bob G. Alexander, Philip D. Devlin or Randall
D. Cooley, all of National Energy Group, Inc., +1-214-692-9211,
or fax, +1-214-692-5055
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