Supplemental Condensed Consolidating Financial Information

6 Months Ended

Dec. 31, 2015

Supplemental Condensed Consolidating Financial Information [Abstract]

Supplemental Condensed Consolidating Financial Information

Note 12 - Supplemental Condensed Consolidating Financial Information

In connection with issuing the 8.25% Senior Notes described in Note 6 - Indebtedness, all of our existing direct and indirect domestic subsidiaries (other than immaterial subsidiaries) each of which is 100% owned by EPL (the “Guarantor Subsidiaries”), jointly and severally guaranteed the payment obligations under our 8.25% Senior Notes. The guarantees are full and unconditional, as those terms are used in Rule 3-10 of Regulation S-X, except that a Guarantor Subsidiary can be automatically released and relieved of its obligations under certain customary circumstances contained in the 2011 Indenture. So long as other applicable provisions of the indenture are adhered to, these customary circumstances include: when a Guarantor Subsidiary is declared “unrestricted” for covenant purposes, when the requirements for legal defeasance or covenant defeasance or to discharge the indenture have been satisfied, or when the Guarantor Subsidiary is sold or sells all of its assets. The following supplemental financial information sets forth, on a consolidating basis, the balance sheets, statements of operations and cash flow information for EPL (Parent Company Only) and for the Guarantor Subsidiaries. We have not presented separate financial statements and other disclosures concerning the Guarantor Subsidiaries, or for any individual Guarantor Subsidiary, because management has determined that such information is not material to investors.

The supplemental condensed consolidating financial information has been prepared pursuant to the rules and regulations for condensed financial information and does not include all disclosures included in annual financial statements. The principal eliminating entries eliminate investments in subsidiaries and intercompany balances.

EPL OIL & GAS, INC.

Supplemental Condensed Consolidating Balance Sheet

As of December 31, 2015

(UNAUDITED)


	Parent
	Company		Guarantor
	Only		Subsidiaries		Eliminations		Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	-	$	-	$	-	$	-
Trade accounts receivable - net		42,480		-		-		42,480
Intercompany receivables		-		127,756		(127,756)		-
Restricted cash		6,025		-		-		6,025
Prepaid expenses		2,631		-		-		2,631
Total current assets		51,136		127,756		(127,756)		51,136
Property and equipment, net		478,477		2,949		-		481,426
Restricted cash		30,008		-		-		30,008
Investment in affiliates		130,705		-		(130,705)		-
Other assets and debt issuance costs, net of accumulated amortization		1,036		-		-		1,036
Total assets	$	691,362	$	130,705	$	(258,461)	$	563,606
LIABILITIES AND STOCKHOLDER'S DEFICIT
Current liabilities:
Accounts payable	$	33,076	$	-	$	-	$	33,076
Due to EGC		202,767		-		-		202,767
Intercompany payables		127,756		-		(127,756)		-
Accrued liabilities		94,567		-		-		94,567
Asset retirement obligations		29,077		-		-		29,077
Total current liabilities		487,243		-		(127,756)		359,487
Long-term debt		651,462		-		-		651,462
Promissory note payable to EGC		325,000		-		-		325,000
Asset retirement obligations		160,909		-		-		160,909
Total liabilities		1,624,614		-		(127,756)		1,496,858
Stockholder's equity (deficit):
Preferred stock		-		-		-		-
Common stock		-		-		-		-
Additional paid-in capital		1,599,341		85,479		(85,479)		1,599,341
Retained earnings (accumulated deficit)		(2,532,593)		45,226		(45,226)		(2,532,593)
Total stockholder's equity (deficit)		(933,252)		130,705		(130,705)		(933,252)
Total liabilities and stockholder's equity (deficit)	$	691,362	$	130,705	$	(258,461)	$	563,606

EPL OIL & GAS, INC.

Supplemental Condensed Consolidating Balance Sheet

As of June 30, 2015

(AUDITED)


	Parent
	Company		Guarantor
	Only		Subsidiaries		Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	217	$	-		$	-	$	217
Trade accounts receivable - net		71,406		-			(83)		71,323
Intercompany receivables		-		128,170			(128,170)		-
Derivative financial instruments		888		-			-		888
Restricted cash		6,024		-			-		6,024
Prepaid expenses		1,831		-			-		1,831
Total current assets		80,366		128,170			(128,253)		80,283
Property and equipment, net		1,412,076		2,949			-		1,415,025
Investment in affiliates		130,705		-			(130,705)		-
Other assets and debt issuance costs, net of accumulated amortization		1,039		-			-		1,039
Total assets	$	1,624,186	$	131,119		$	(258,958)	$	1,496,347
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	24,217	$	414		$	(83)	$	24,548
Due to EGC		170,728		-			-		170,728
Intercompany payables		128,170		-			(128,170)		-
Accrued liabilities		95,981		-			-		95,981
Asset retirement obligations		38,056		-			-		38,056
Derivative financial instruments		1,057		-			-		1,057
Current maturities of long-term debt		3,364		-			-		3,364
Total current liabilities		461,573		414			(128,253)		333,734
Long-term debt		689,459		-			-		689,459
Intercompany promissory note		325,000		-			-		325,000
Asset retirement obligations		202,306		-			-		202,306
Total liabilities		1,678,338		414			(128,253)		1,550,499
Stockholder's equity (deficit):
Preferred stock		-		-			-		-
Common stock		-		-			-		-
Additional paid-in capital		1,599,341		85,479			(85,479)		1,599,341
Retained earnings (accumulated deficit)		(1,653,493)		45,226			(45,226)		(1,653,493)
Total stockholder's equity (deficit)		(54,152)		130,705			(130,705)		(54,152)
Total liabilities and stockholder's equity (deficit)	$	1,624,186	$	131,119		$	(258,958)	$	1,496,347

EPL OIL & GAS, INC.

Supplemental Condensed Consolidating Statement of Operations

Three Months Ended December 31, 2015

(UNAUDITED)


	Parent
	Company		Guarantor
	Only		Subsidiaries		Eliminations		Consolidated
	(In thousands)
Revenues
Oil sales	$	54,408	$	-	$	-	$	54,408
Natural gas sales		8,256		-		-		8,256
Gain on derivative instruments		906		-		-		906
Total revenues		63,570		-		-		63,570
Costs and expenses
Lease operating		30,889		-		-		30,889
Transportation		664		-		-		664
Depreciation, depletion and amortization		62,333		-		-		62,333
Accretion of asset retirement obligations		6,317		-		-		6,317
Impairment of oil and natural gas properties		504,772		-		-		504,772
General and administrative		9,978		-		-		9,978
Taxes, other than on earnings		39		-		-		39
Total costs and expenses		614,992		-		-		614,992
Operating loss		(551,422)		-		-		(551,422)
Other income (expense):
Other income, net		2,393		-		-		2,393
Gain on early extinguishment of debt		21,269		-		-		21,269
Interest expense		(16,772)		-		-		(16,772)
Total other income, net		6,890		-		-		6,890
Loss before income taxes		(544,532)		-		-		(544,532)
Income tax expense		-		-		-		-
Net loss	$	(544,532)	$	-	$	-	$	(544,532)

EPL OIL & GAS, INC.

Supplemental Condensed Consolidating Statement of Operations

Three Months Ended December 31, 2014

(UNAUDITED)


	Parent
	Company		Guarantor
	Only		Subsidiaries		Eliminations		Consolidated
	(In thousands)
Revenues
Oil sales	$	109,070	$	11,758	$	-	$	120,828
Natural gas sales		12,499		49		-		12,548
Gain on derivative instruments		22,262		-		-		22,262
Total revenues		143,831		11,807		-		155,638
Costs and expenses
Lease operating		50,044		5,260		-		55,304
Transportation		1,148		1		-		1,149
Depreciation, depletion and amortization		82,382		6,165		-		88,547
Accretion of asset retirement obligations		4,910		1,188		-		6,098
Impairment of oil and natural gas properties		690,312		-		-		690,312
General and administrative		6,810		-		-		6,810
Taxes, other than on earnings		494		1,450		-		1,944
Total costs and expenses		836,100		14,064		-		850,164
Operating loss		(692,269)		(2,257)		-		(694,526)
Other income (expense):
Other income, net		4		-		-		4
Interest expense		(10,947)		-		-		(10,947)
Income from equity investments		(1,424)		-		1,424		-
Total other expense, net		(12,367)		-		1,424		(10,943)
Loss before income taxes		(704,636)		(2,257)		1,424		(705,469)
Income tax benefit		(250,024)		(833)		-		(250,857)
Net loss	$	(454,612)	$	(1,424)	$	1,424	$	(454,612)

EPL OIL & GAS, INC.

Supplemental Condensed Consolidating Statement of Operations

Six Months Ended December 31, 2015

(UNAUDITED)


	Parent
	Company		Guarantor
	Only		Subsidiaries		Eliminations		Consolidated
	(In thousands)
Revenues
Oil sales	$	127,780	$	-	$	-	$	127,780
Natural gas sales		20,874		-		-		20,874
Gain on derivative instruments		3,684		-		-		3,684
Total revenues		152,338		-		-		152,338
Costs and expenses
Lease operating		57,042		-		-		57,042
Transportation		1,387		-		-		1,387
Depreciation, depletion and amortization		119,993		-		-		119,993
Accretion of asset retirement obligations		13,058		-		-		13,058
Impairment of oil and natural gas properties		812,850		-		-		812,850
General and administrative		17,922		-		-		17,922
Taxes, other than on earnings		(896)		-		-		(896)
Total costs and expenses		1,021,356		-		-		1,021,356
Operating loss		(869,018)		-		-		(869,018)
Other income (expense):
Other income, net		2,405		-		-		2,405
Gain on early extinguishment of debt		21,269		-		-		21,269
Interest expense		(33,756)		-		-		(33,756)
Total other expense, net		(10,082)		-		-		(10,082)
Loss before income taxes		(879,100)		-		-		(879,100)
Income tax expense		-		-		-		-
Net loss	$	(879,100)	$	-	$	-	$	(879,100)

EPL OIL & GAS, INC.

Supplemental Condensed Consolidating Statement of Operations

Six Months Ended December 31, 2014

(UNAUDITED)


	Parent
	Company		Guarantor
	Only		Subsidiaries		Eliminations		Consolidated
	(In thousands)
Revenues
Oil sales	$	249,785	$	29,359	$	-	$	279,144
Natural gas sales		26,354		148		-		26,502
Gain on derivative instruments		44,119		-		-		44,119
Total revenues		320,258		29,507		-		349,765
Costs and expenses
Lease operating		102,618		8,986		-		111,604
Transportation		1,772		2		-		1,774
Depreciation, depletion and amortization		150,387		11,905		-		162,292
Accretion of asset retirement obligations		10,252		2,027		-		12,279
Impairment of oil and natural gas properties		690,312		-		-		690,312
Goodwill impairment		329,293		-		-		329,293
General and administrative		14,852		-		-		14,852
Taxes, other than on earnings		599		3,873		-		4,472
Other		21		-		-		21
Total costs and expenses		1,300,106		26,793		-		1,326,899
Operating income (loss)		(979,848)		2,714		-		(977,134)
Other income (expense):
Other income, net		4		-		-		4
Interest expense		(21,848)		-		-		(21,848)
Income from equity investments		1,711		-		(1,711)		-
Total other expense, net		(20,133)		-		(1,711)		(21,844)
Income (loss) before income taxes		(999,981)		2,714		(1,711)		(998,978)
Income tax benefit		(239,013)		1,003		-		(238,010)
Net income (loss)	$	(760,968)	$	1,711	$	(1,711)	$	(760,968)

EPL OIL & GAS, INC.

Supplemental Condensed Consolidating Statement of Cash Flows

Six Months Ended December 31, 2015

(UNAUDITED)


	Parent
	Company		Guarantor
	Only		Subsidiaries		Eliminations		Consolidated
	(In thousands)
Net cash provided by operating activities	$	27,463	$	-	$	-	$	27,463
Cash flows used in investing activities:
Capital expenditures		(16,122)		-		-		(16,122)
Net cash used in investing activities		(16,122)		-		-		(16,122)
Cash flows provided by (used in) financing activities:
Payments on long-term debt		(3,395)		-		-		(3,395)
Cash restricted under revolving credit facility related to property sold		(30,008)		-		-		(30,008)
Advances from EGC		22,034		-		-		22,034
Debt issuance costs		(189)		-		-		(189)
Net cash used in financing activities		(11,558)		-		-		(11,558)
Net decrease in cash and cash equivalents		(217)		-		-		(217)
Cash and cash equivalents at beginning of period		217		-		-		217
Cash and cash equivalents at end of period	$	-	$	-	$	-	$	-

EPL OIL & GAS, INC.

Supplemental Condensed Consolidating Statement of Cash Flows

Six Months Ended December 31, 2014

(UNAUDITED)


	Parent
	Company		Guarantor
	Only		Subsidiaries		Eliminations		Consolidated
	(In thousands)
Net cash provided by operating activities	$	93,232	$	5,669	$	-	$	98,901
Cash flows used in investing activities:
Property acquisitions		(350)		-		-		(350)
Capital expenditures		(233,421)		(5,669)		-		(239,090)
Other property and equipment additions		(58)		-		-		(58)
Net cash used in investing activities		(233,829)		(5,669)		-		(239,498)
Cash flows provided by financing activities:
Advances from EGC		135,480		-		-		135,480
Net cash provided by financing activities		135,480		-		-		135,480
Net decrease in cash and cash equivalents		(5,117)		-		-		(5,117)
Cash and cash equivalents at beginning of period		5,601		-		-		5,601
Cash and cash equivalents at end of period	$	484	$	-	$	-	$	484

EPL OIL & GAS, INC. 10-Q