Net cash provided by operations increased $2,925,000 from $121,000
during the six months ended December 31, 1994 to $3,046,000 for the current
period. The increase was attributable primarily to a smaller increase in
accounts payable and accrued expenses and higher net income and depreciation
expense compared to the same period last year.
Net cash used in investing activities increased from $3,117,000 for the
six months ended December 31, 1994 to $4,244,000 for the current period. The
increase was primarily the result of increased expenditures for oil and gas
properties . In addition, net cash used in investing activities for the current
period included $360,000 used in the oil and gas well drilling operations.
Net cash provided by financing activities decreased to $878,000 for the
six months ended December 31, 1995 as compared to $2,790,000 for the comparable
period in 1994. The decrease was primarily the result of increased principal
payments made during the current period compared to the prior period, and a
decrease in proceeds from long-term debt during the current period. Such
proceeds were primarily used for the oil and natural gas drilling program
conducted by Odessa Exploration.
Fiscal Year Ended June 30, 1995 Compared to Fiscal Year Ended June 30, 1994
Results of Operations
Results of operations for the fiscal years ended June 30, 1994 and 1995
include Key's oil field well service operations, its oil and gas operations and
its oil and gas drilling operations. Comparative results during the period were
effected to a significant extent by the several acquisitions made by during the
period as follows:
o In March 1995, Key acquired from Clint Hurt & Associates ("CHA") all of
CHA's assets in West Texas, which consisted principally of four oil and
gas drilling rigs and related equipment. As a result of this
acquisition, Key entered into the business of drilling oil and natural
gas wells for independent and major oil companies primarily in the West
o In August 1994, Key consummated the acquisition of substantially all of
WellTech's assets used in its oil and gas well servicing business in
West Texas. Prior to consummation of the acquisition, in December
1993, Key entered into an interim operating agreement under which it
operated the West Texas division of WellTech.
o In August 1993, Key acquired Odessa Exploration and, as a consequence,
commenced operation of oil and natural gas wells and exploration for
oil and natural gas in the Permian Basin area of West Texas.