-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ejesq/G4q6YotMYtxqEIDng7ipOpytouu0HMdSlw6C2nvAA3vQMO5NQWpu07HlEi IRrax3np70LHpqGbvUKMTA== 0000950129-04-002875.txt : 20040506 0000950129-04-002875.hdr.sgml : 20040506 20040506081732 ACCESSION NUMBER: 0000950129-04-002875 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040506 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040506 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HARVEST NATURAL RESOURCES INC CENTRAL INDEX KEY: 0000845289 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 770196707 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10762 FILM NUMBER: 04783271 BUSINESS ADDRESS: STREET 1: 15835 PARK TEN PLACE DRIVE STREET 2: SUITE 115 CITY: HOUSTON STATE: TX ZIP: 77084 BUSINESS PHONE: 2815796700 MAIL ADDRESS: STREET 1: 15835 PARK TEN PLACE DRIVE STREET 2: SUITE 115 CITY: HOUSTON STATE: TX ZIP: 77084 FORMER COMPANY: FORMER CONFORMED NAME: BENTON OIL & GAS CO DATE OF NAME CHANGE: 19920703 8-K 1 h15115e8vk.txt HARVEST NATURAL RESOURCES, INC. - MAY 6, 2004 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): May 6, 2004 HARVEST NATURAL RESOURCES, INC. (Exact name of registrant as specified in its charter) Delaware 1-10762 77-0196707 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 15835 Park Ten Place Drive, Suite 115 Houston, Texas 77084 (Address, including zip code, of principal executive offices) (281) 579-6700 (Registrant's telephone number, including area code) ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (c) EXHIBITS. 99.1 Press release dated May 6, 2004 providing results of operations for the 1st quarter ended March 31, 2004. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION On May 6, 2004, Harvest Natural Resources, Inc. ("Harvest") issued a Press Release (the "Press Release") providing results for the first quarter ended March 31, 2004. The Press Release contains information regarding Harvest's discretionary cash flow, a non-GAAP financial measure which Harvest's management believes provides useful information to investors regarding the net cash provided by operating activities without regard to the changes in the operating assets and liabilities. These changes are short-term in nature and can fluctuate based on the activities within a single reporting period. The Press Release includes a reconciliation of the differences between discretionary cash flow and net cash provided by operating activities. The foregoing is qualified by reference to the Press Release which is furnished as an exhibit to this report and incorporated herein by reference. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. HARVEST NATURAL RESOURCES, INC. By: /s/ Kerry R. Brittain ------------------------------------ Kerry R. Brittain Senior Vice President, General Counsel and Corporate Secretary Date: May 6, 2004 INDEX TO EXHIBITS Item Number Exhibit ------ ------- 99.1 Press release dated May 6, 2004 providing results of operations for the 1st quarter ended March 31, 2004. EX-99.1 2 h15115exv99w1.txt PRESS RELEASE EXHIBIT 99.1 [HARVEST LOGO] FOR IMMEDIATE RELEASE HARVEST NATURAL RESOURCES ANNOUNCES FIRST QUARTER 2004 RESULTS HOUSTON, Texas (May 6, 2004) - Harvest Natural Resources, Inc. (NYSE: HNR) today announced 2004 first quarter earnings of $7.5 million, or $0.20 per diluted share. These results compare with the net loss of $15.5 million, or $0.44 per diluted share, for the same period last year. The first quarter of 2003 was affected by the shut-in of production in Venezuela during all of January and part of February due to the national work stoppage. Discretionary cash flow (defined as cash flows from operating activities before changes in operating assets and liabilities) was $18.4 million for the 2004 first quarter compared with $5.1 million for the 2003 first quarter. See reconciliation to Generally Accepted Accounting Principles in table below. Harvest President and Chief Executive Officer, Dr. Peter J. Hill, said, "Average natural gas production of 85 million cubic feet per day, attractive oil prices and a continued focus on costs were all factors in delivering strong first quarter financial results. If oil prices remain at these levels for the remainder of the year, we would expect to exceed our previous 2004 guidance regarding net income and discretionary cash flow that was based on an average West Texas Intermediate oil price of $26 per barrel." Production for the 2004 first quarter was 1.9 million barrels of oil and 7.8 billion cubic feet of natural gas for a combined total production of 3.2 million barrels of oil equivalent. Production for the same period last year, which consisted of oil only, was 1.2 million barrels. Lower production in the first quarter of 2003 was attributable to the production shut-in. Hill said, "The start of our 10-well drilling program in the Uracoa Field is expected to be delayed until late in the second quarter due to the inability to obtain a contract for an acceptable drilling rig in Venezuela. Our drilling program is designed to permit us to add incremental oil production later this year." The Company received an average of $16.10 per barrel of oil for 2004 first quarter sales, an increase of $0.76 per barrel, compared with the $15.34 per barrel average for the same period last year. The Company also received $1.03 per thousand cubic feet of natural gas delivered to PDVSA. 15835 Park Ten Place Drive o Houston, Texas 77084 o ph: 281.579.6700 fax: 281.579.6760 Page 1 of 2 Hill continued, "Our strong balance sheet and cash generating capacity provide us with the financial flexibility to simultaneously pursue growth opportunities in both Russia and Venezuela. We continue to evaluate properties in both countries to find opportunities which meet our acquisition criteria." RECONCILIATION OF NON-GAAP MEASURES ($MM) - -----------------------------------------
Three Months Ended March 31, ---------------------------- 2004 2003 ----- ----- Net cash provided by operating activities $10.2 $11.2 Changes in operating assets & liabilities 8.2 (6.1) ----- ----- Discretionary cash flow $18.4 $ 5.1 ===== =====
Harvest Natural Resources, Inc. headquartered in Houston, Texas, is an independent oil and gas exploration and development company with principal operations in Venezuela and Russia. For more information visit the Company's website at www.harvestnr.com. CONTACT: Steven W. Tholen Senior Vice President, Chief Financial Officer (281) 646-2186 Amanda M. Koenig Investor Relations (281) 646-2173 This press release may contain "Forward-Looking Statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts included in this release may constitute forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Actual results may differ materially from the Company's expectations due to changes in operating performance, project schedules, oil and gas demands and prices, and other technical and economic factors. ================================================================================ 15835 Park Ten Place Drive o Houston, Texas 77084 o ph: 281.579.6700 fax: 281.579.6760 Page 2 of 2 HARVEST NATURAL RESOURCES, INC. CONSOLIDATED BALANCE SHEETS ($ millions, unaudited)
March 31, December 31, 2004 2003 ------- ------- ASSETS: - ------- CURRENT ASSETS: Cash and equivalents $ 147.2 $ 138.7 Accounts receivable, net 49.9 43.9 Prepaid expenses and other 1.4 0.8 ------- ------- Total current assets 198.5 183.4 OTHER ASSETS 2.6 2.1 DEFERRED INCOME TAXES 4.7 4.7 INVESTMENTS IN AND ADVANCES TO AFFILIATED COMPANIES -- -- PROPERTY AND EQUIPMENT, net 176.7 184.1 ------- ------- TOTAL ASSETS $ 382.5 $ 374.3 ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY: - ------------------------------------- CURRENT LIABILITIES: Accounts payable, trade and other $ 1.5 $ 4.2 Accounts payable, related party 10.8 10.5 Accrued expenses 12.2 15.1 Accrued interest 3.4 1.4 Income taxes payable 10.2 8.6 Current portion of long-term debt 5.1 6.4 ------- ------- Total current liabilities 43.2 46.2 LONG TERM DEBT 96.5 96.8 ASSET RETIREMENT PROVISION 1.5 1.5 COMMITMENTS AND CONTINGENCIES -- -- MINORITY INTEREST 32.7 30.1 STOCKHOLDERS' EQUITY: Common stock and paid-in capital 176.8 175.4 Retained earnings 35.0 27.5 Treasury stock (3.2) (3.2) ------- ------- Total stockholders' equity 208.6 199.7 ------- ------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 382.5 $ 374.3 ======= =======
HARVEST NATURAL RESOURCES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands except per BOE and per share amounts, unaudited)
- -------------------------------------------------------------------------------------------------------------------- THREE MONTHS ENDED: March 31, 2004 March 31, 2003 - ------------------- ------------------------ ------------------------- Barrels of oil sold 1,914 1,227 MMCF of gas sold 7,757 Total BOE 3,207 1,227 Average price/barrel $16.10 $15.34 Average price/mcf $1.03 - -------------------------------------------------------------------------------------------------------------------- $ $/BOE $ $/BOE ------------------------------------------------------- REVENUES: Oil sales $ 30,808 $ 19,390 Gas sales 7,989 Ineffective hedge activity (565) ------------------------------------------------------- 38,797 12.10 18,825 15.34 ------------------------------------------------------- EXPENSES: Operating expenses 7,339 2.29 6,515 5.31 Depletion and amortization 7,723 2.41 3,156 2.57 Depreciation 438 0.14 359 0.29 General and administrative 3,635 1.13 3,224 2.63 Taxes other than on income 1,194 0.37 647 0.53 ------------------------------------------------------- 20,329 6.34 13,901 11.33 ------------------------------------------------------- INCOME FROM OPERATIONS 18,468 5.76 4,924 4.01 ======================================================= OTHER NON-OPERATING INCOME (EXPENSE) Investment income and other 303 0.09 278 0.23 Interest expense (2,489) (0.78) (2,668) (2.17) Net gain on exchange rates (609) (0.19) 526 0.43 ------------------------------------------------------- (2,795) (0.88) (1,864) (1.51) - -------------------------------------------------------------------------------------------------------------------- INCOME FROM CONSOLIDATED COMPANIES BEFORE INCOME TAXES AND MINORITY INTERESTS 15,673 4.88 3,060 2.50 Income tax expense 5,600 1.75 1,056 0.86 - -------------------------------------------------------------------------------------------------------------------- INCOME BEFORE MINORITY INTERESTS 10,073 3.13 2,004 1.64 Minority interest in consolidated subsidiary companies 2,566 0.80 887 0.72 - -------------------------------------------------------------------------------------------------------------------- INCOME FROM CONSOLIDATED COMPANIES 7,507 2.33 1,117 0.92 Equity in net loss of affiliated companies -- -- (16,575) (13.51) ------------------------------------------------------- NET INCOME $7,507 $2.33 ($15,458) ($12.59) - -------------------------------------------------------------======================================================= NET INCOME PER COMMON SHARE: Basic $0.21 ($0.44) Diluted $0.20 ($0.44) - -------------------------------------------------------------------------------------------------------------------- Weighted average shares outstanding: Basic 35.8 million 35.3 million Diluted 37.9 million 35.3 million - --------------------------------------------------------------------------------------------------------------------
HARVEST NATURAL RESOURCES, INC. CONSOLIDATED STATEMENT OF CASH FLOWS (in thousands, unaudited)
Three Months Ended March 31, ------------------------- 2004 2003 --------- --------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 7,507 ($ 15,458) Adjustments to reconcile net income to net cash provided by operating activities: Depletion, depreciation and amortization 8,161 3,515 Amortization of financing costs 76 140 Equity in earnings of affiliated companies 16,575 Allowance and write off of employee notes and accounts receivable 51 Non-cash compensation-related charges 96 42 Minority interest in undistributed earnings of subsidiaries 2,566 887 Deferred income taxes (667) Changes in operating assets and liabilities: Accounts and notes receivable (5,903) 5,896 Prepaid expenses and other (586) 378 Put option (6,875) Accounts payable (2,639) 2,335 Accounts payable, related party 256 271 Accrued expenses (2,861) (664) Accrued interest payable 1,981 2,231 Asset retirement liability 4,263 Commodity hedging contract payable (430) Income taxes payable 1,577 (1,315) --------- --------- Net Cash Provided By Operating Activities 10,231 11,175 --------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Additions of property and equipment (743) (12,505) Investment in and advances to affiliated companies (497) Increase in restricted cash 1,800 Purchases of marketable securities (200,332) Maturities of marketable securities 200,650 Investment costs (573) 22 --------- --------- Net Cash Provided By (Used In) Investing Activities (1,316) (10,862) --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds from exercise of stock options 1,256 120 Repurchase of common stock (404) Payments on short term borrowings and notes payable (1,592) (2,767) --------- --------- Net Cash Provided By (Used in) Financing Activities (336) (3,051) --------- --------- Net Increase in Cash 8,579 (2,738) Cash and Cash Equivalents at Beginning of Period 138,660 64,501 --------- --------- Cash and Cash Equivalents at End of Period $ 147,239 $ 61,763 ========= =========
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