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: September 5, 2002
HELMERICH & PAYNE, INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-4221 73-0679879
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(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
incorporation) Number)
Utica at Twenty-first Street, Tulsa, Oklahoma 74114
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(Address of principal executive offices) (Zip Code)
(918) 742-5531
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(Registrant's telephone number, including area code)
N/A
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(Former name or former address, if changed since last report)
Page 1 of 5 Pages.
Item 9. Regulation FD Disclosure.
On September 5, 2002, Helmerich & Payne, Inc. issued the following
press release:
"TULSA, OK., - Helmerich & Payne, Inc. (the "Company") announced today
that the Securities and Exchange Commission had recently declared
effective the Registration Statement of the Company's wholly-owned
subsidiary, Cimarex Energy Co. ("Cimarex"). The Registration Statement
relates to the shares of Cimarex stock to be issued in the merger with
Key Production Company, Inc. (NYSE - KP). Proxy Statements and
Prospectuses have been mailed to Key Production shareholders with the
vote regarding the merger scheduled for September 20. If approved by
the Key shareholders, the spin-off of Cimarex and its merger with Key
is expected to occur on September 30, 2002. Cimarex has applied for
listing on the New York Stock Exchange, and if accepted, will trade
under the symbol XEC.
The Company also gave earnings guidance for its next fiscal year ending
September 30, 2003. Currently the Company's rig fleet includes 64 U.S.
land rigs, 12 offshore platform rigs, and 33 international land rigs.
Average rig utilizations for those respective markets are currently
88%, 58% and 36%. Average revenue per day in those respective markets
for the third quarter ended June 30, 2002 were $11,500, $28,591, and
$19,911. The Company estimates that FY 2003 net income could range
between $0.90 and a $1.00 per share and EBITDA could range from $3.20
to $3.35 per share given the following assumptions. U.S. land rig
revenue per day will not increase appreciably until the Company's third
quarter ending June 30, 2003 when revenue per day would average
$13,000, and increase to an average of $14,000 per day during the
fourth quarter. The Company also plans to complete construction of 17
FlexRigs(TM)* during 2003. Given these estimates, average U.S. land rig
revenue per day for all of 2003 would average $12,600, representing a
9.6% increase over the actual average revenue per day for the third
quarter of 2002. The average U.S. land rig utilization assumption is
86% for the year.
Earnings guidance also assumes an improvement in offshore platform rig
utilization during the third and fourth fiscal quarters. Utilization
would rise from 50% in the first two quarters to 60% in the third
quarter and 66% in the fourth
*FlexRig(TM) hereinafter referred to as FlexRig.
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quarter. Average revenue per day is estimated to remain flat. In the
Company's international operations, utilization is expected to be flat
during the first half of the year and rise in the third and fourth
periods, averaging 49% for 2003. No appreciable change in average
international revenue per day is anticipated. Should industry and
Company results not improve from current levels, Company earnings would
be closer to $0.60 per share.
In addition to releasing earnings guidance, the Company announced that
its capital expenditures for fiscal year 2003 are estimated to be
approximately $195 million, which includes approximately $100 million
for the completion of 17 FlexRigs during the year. Additionally, the
Company now has completed its arrangement of a total of $200 million of
privately placed medium term notes. The medium term note program
consists of four series with maturity terms of 5, 7, 10 and 12 years.
The 5 and 7 year notes are $25 million each, while the 10 and 12 year
maturities are $75 million each. For the entire $200 million placement,
the weighted average interest rate is 6.3%, with a weighted average
maturity of 9.75 years. As previously announced, the Company also
liquidated a portion of its investment portfolio, generating proceeds
of approximately of $41 million for 2002.
President and C.E.O., Hans Helmerich commented, "The performance of the
Company's FlexRig technology in the field, underscored by FlexRig
utilization rates of close to 100%, are clear indicators of the value
they add to our customers' operations. We are also excited about the
greater visibility the Company will have as a stand-alone drilling
company following the spin-off of Cimarex".
Helmerich & Payne, Inc. (HP/NYSE) is an energy-oriented company engaged
in contract drilling and oil and gas exploration and production.
Currently, H&P has 64 U.S. land rigs, 12 U.S. platform rigs located in
the Gulf of Mexico, and 33 rigs located in South America. Of the 64
U.S. land rigs currently available, 24 are the H&P-designed FlexRig.
The Company is scheduled to complete the construction of an additional
19 FlexRigs to be put in service over the next 12 to 14 months.
Forward-Looking Statements
It should be noted that this announcement contains certain statements
that may be deemed to be "forward-looking" statements within the
meaning of Section
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27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Such forward-looking
statements include, without limitation, statements regarding the
consummation of the proposed spin-off and merger, its effect on future
earnings, cash flow or other operating results, the expected closing
date of the proposed spin-off and merger, any other effect or benefit
of the proposed spin-off and merger, the tax treatment of the proposed
spin-off and merger and the combined company, market prospects, and any
other statements that are not historical facts. H&P and Key strongly
encourage readers to note that some or all of the assumptions upon
which such forward-looking statements are based are beyond their
ability to control or estimate precisely, and may in some cases be
subject to rapid and material changes. Such assumptions include, but
are not limited to, costs and difficulties related to the integration
of the businesses, costs, delays and other difficulties related to the
proposed spin-off and merger, closing conditions not being satisfied,
general market conditions prevailing in the exploration for and
development and production of oil and gas (including inflation or lack
of availability of goods and services, environmental risks, drilling
risks and regulatory changes), operating hazards and delays, actions by
customers and other third parties, the future price of oil and gas, and
other factors detailed in H&P's filings with the Securities and
Exchange Commission (the "SEC"), which are available free of charge on
the SEC's website at www.sec.gov. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those indicated. H&P
and Key undertake no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events or
otherwise.
Additional Information
In connection with the proposed spin-off and merger, Key and Cimarex
filed with the SEC on May 9, 2002, a Registration Statement No.
333-87948 on Form S-4. This Registration Statement was declared
effective by the SEC on August 21, 2002. Investors and security holders
are urged to carefully read the Registration Statement regarding the
proposed transaction because it contains important information.
Investors and security holders may obtain a free copy of the
Registration Statement and other documents containing information about
Key and H&P's oil and gas division, without charge, at the SEC's web
site at www.sec.gov. Copies of the Registration Statement and the SEC
filings incorporated by reference therein may also be obtained for free
by directing a
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request to either: Key Production Company, Inc., 707 Seventeenth
Street, Suite 3300, Denver, Colorado 80202, Attention: Sharon M. Pope,
Assistant Corporate Secretary; telephone 303-295-3995, fax:
303-295-3494, or Helmerich & Payne, Inc, Utica at Twenty-First Street,
Tulsa, Oklahoma 74114, Attention: Steven R. Mackey, Corporate
Secretary; telephone 918-742-5531, fax 918-743-2671.
Participants in Solicitation
H&P and Cimarex and their respective directors and executive officers
may be deemed to be participants in the solicitation of proxies from
Key's shareholders in connection with the proposed merger. Hans
Helmerich, Douglas E. Fears and Steven R. Mackey are currently
directors of Cimarex, and each of them and Steven R. Shaw are currently
officers of Cimarex (the "Cimarex Participants"). None of the Cimarex
Participants beneficially owns any shares of Cimarex common stock. The
Cimarex Participants are all executive officers of H&P. Information
concerning H&P's participants in the solicitation is set forth in H&P's
proxy statement dated January 25, 2002, which is filed with the SEC.
Key's shareholders may obtain additional information about the
interests of all such participants in the proposed merger by reading
Registration Statement No. 333-87948 on Form S-4 which was declared
effective by the SEC on August 21, 2002. Investors should read the
Registration Statement carefully before making any voting or investment
decisions."
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, thereunto duly authorized.
HELMERICH & PAYNE, INC.
(Registrant)
By: /s/ STEVEN R. MACKEY
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Name: Steven R. Mackey
Title: Vice President
Dated: September 5, 2002
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