PITTSBURGH, Dec. 21, 1995 -- Equitable Resources
(NYSE:
EQT) announced today that it will take a non-cash, after-tax charge
of approximately $71 million or $2.05 per share in the fourth
quarter. The charge, which is similar to asset write-downs
announced by other integrated energy companies, is primarily the
result of following the methodology of a new accounting standard for
the impairment of long-lived assets. As a result of the fourth
quarter charge, Equitable expects to reduce 1996 non-cash operating
expenses by at least $12 million based on expected production.
President and CEO Fred Abrew called the one-time charge, "Another
measured step that will give us greater flexibility to drive toward
improved financial performance."
In March 1995, the Financial Accounting Standards Board (FASB)
issued Statement No. 121, "Accounting for the Impairment of Long-
Lived Assets...". The standard, which must be adopted by affected
corporations in 1996, requires companies to adjust the value of
assets on their balance sheets when that value exceeds the future
expected cash flows to be generated by those assets.
The impact of the charge on Equitable's fourth quarter 1995
results will be partially offset by the earnings recognized from the
receipt of the proceeds from the href="chap11.columbia.html">Columbia Gas Chapter 11
reorganization. Equitable received approximately $29 million after-
tax, adding 83 cents per share to fourth quarter, 1995 earnings.
Approximately 60 percent of Equitable's charge reflects the
write-down of various producing properties and undeveloped oil and
gas leases. About 20 percent relates to certain parts of the
Company's intrastate pipeline and the remainder is attributable to
specific non-performing assets not related to the Company's core
businesses.
Equitable Resources is a full service energy marketing company.
It offers energy solutions to the wholesale and retail markets with
innovative products and services developed through its exploration,
production, storage, transportation and distribution of natural gas
and electricity operations. Equitable Resources also produces
natural gas liquids and crude oil.
/CONTACT: Robert C. Atkinson of Equitable Resources, 412-553-5768/
HOUSTON, Dec. 21, 1995 -- Edisto
Resources Corporation
(AMEX: EDS) today announced that its Board of Directors has
authorized the company to repurchase up to 1,000,000 shares of
Edisto's common stock from time to time in the open market. The
timing and amounts of purchases will be governed by market
conditions. Edisto has 12,954,246 outstanding shares of common
stock which trade on the American Stock Exchange.
Edisto said it was initiating this stock repurchase because it
believes that the recent market prices of Edisto's shares have been
substantially less than their underlying value.
Edisto also announced that it has engaged the investment banking
firm of James D. Wolfensohn Incorporated to make recommendations to
management and the board of directors for strategic alternatives to
enhance shareholder value. Wolfensohn's duties will include
identifying and evaluating strategic partners and investment
opportunities to enhance the continued growth of Edisto.
Michael Y. McGovern, Edisto's chairman and chief executive
officer, commented: "The Edisto post-bankruptcy turnaround has been
substantially completed now that the NOARK litigation has been
resolved, as announced yesterday. Now, we want to aggressively look
at opportunities to grow the company and maximize value for our
shareholders. As the gas marketing industry continues to
consolidate and branch into electric power marketing, we believe
there are a number of strategic opportunities that Wolfensohn can
help the company pursue. We also believe that another avenue to
increase shareholder value is to use some of our excess cash to
repurchase our shares."
Edisto Resources Corporation's consolidated activities include
(i) natural gas marketing and the trading of energy related
financial instruments through four wholly owned subsidiaries, and
(ii) oil and gas exploration and production, which is conducted
through its 72 percent interest in Convest Energy Corporation, an
independent company listed on the American Stock Exchange.
/CONTACT: Jerry L. McNeill, vice president of Edisto Resources,
713-782-0095/
MEMPHIS, Tenn., Dec. 21, 1995 -- Harrah's
Entertainment,
Inc.(NYSE: HET) today announced it is pleased that href="chap11.harrahs.html">Harrah's Jazz
Company has put forward to the state of Louisiana a structure for
the reorganization of the Harrah's Jazz Company casino project in
New Orleans. Harrah's Entertainment agrees with Harrah's Jazz
Company's position that for the permanent casino to be successful
for the long term, and for the project to attract new debt and
equity to finish the permanent casino, there need to be certain
fundamental changes to the previous structure. These changes are
set forth in the Harrah's Jazz Company announcement.
In addition, Harrah's Entertainment today also announced that it
is aware of five additional federal securities lawsuits that have
been filed against it pertaining to the announcement that Harrah's
Jazz Company had filed a bankruptcy petition under Chapter 11. The
lawsuits are substantially similar to the two federal securities
lawsuits that had been previously announced. In addition, Harrah's
Entertainment is aware of a lawsuit filed against it alleging
violations of the federal plant-closing law. The complaint, which
seeks certification as a class action and unspecified damages, was
filed in U.S. District of Louisiana. Harrah's Entertainment is also
aware of a lawsuit filed against it by Centex Landis Construction
Co., related to the bankruptcy filing and suspended construction on
the casino project, alleging among other things, breach of contract,
fraud and fraudulent or negligent misrepresentation, and deceptive
advertising. The complaint was filed in Louisiana state court and
seeks money damages in excess of $40 million, and completion of the
permanent casino. Harrah's Entertainment believes that the
allegations in each of the foregoing lawsuits are without merit and
intends to vigorously defend against such lawsuits.
/CONTACT: Ralph Berry, Harrah's Entertainment, Inc., 901-762-8629/
MEMPHIS, Tenn., Dec. 21, 1995 -- href="chap11.harrahs.html">Harrah's Jazz Company
today announced, in response to the request of the state of
Louisiana, that it has provided to representatives of the state
government a structure for negotiating the reorganization of the
Harrah's Jazz Company casino project in New Orleans.
Reiterating its commitment to work diligently toward a plan for
reorganization, Harrah's Jazz Company indicated that for the
permanent casino to be successful for the long term, and for the
project to attract new debt and equity to finish the permanent
casino, there need to be three fundamental sets of changes to the
previous structure. First, the capital costs need to be reduced by
initially reducing the casino's size and scope to the level required
to meet the apparent current market demand while at the same time
delivering an excellent customer experience. Additional capacity
would be added if the market demand grows.
Second, the previous fixed costs must be reduced and
restructured to provide some flexibility for these costs to move
with anticipated revenues, particularly in the early years while
there is an attempt to position New Orleans as an attractive market
for regional and national casino customers. Restructuring of the
payment terms for interest charges, debt service, rent and taxes
will be required if new debt and equity financing is to be attracted
to complete the casino.
The third set of changes that Harrah's Jazz Company indicated
are required deal primarily with the operations of the casino on a
daily basis. The operating contract with the state, the lease with
the city and various city ordinances must permit for normal
commercial operations of the business without undue regulatory
costs, burdens and approvals. Furthermore, the operating standards
set forth in the various documents need to be conformed so the
requirements of both the state of Louisiana and the city of New
Orleans are consistent and do not set different standards for the
operation.
Colin V. Reed, on behalf of Harrah's Jazz Company, said that
none of the contemplated changes were intended to impact the
regulatory structure dealing with the integrity of the games, the
suitability of the investors, or the financial controls relative to
the operating of the casino. Mr. Reed stated, "For the casino to
succeed and meet the targets contemplated in a restructured format,
it must be allowed to compete on a daily basis in a manner
consistent with other casinos in the state of Louisiana and
neighboring jurisdictions. It cannot successfully compete with
limitations imposed by burdensome regulations or non-commercial
restrictions. We are asking that we be allowed the same latitude to
compete as other commercial ventures in the city of New Orleans.
The changes required will also be necessary to attract new financing
to complete the permanent casino."
Mr. Reed further stated that, "We have been prepared for
sometime to negotiate with the State and City on the detailed issues
that must be part of a full plan of reorganization to be submitted
to the Bankruptcy Court for its approval. For these negotiations to
proceed in a business- like manner, with the large number of parties
involved, the complexity of the issues and with the on-going threat
of litigation from certain parties, it is very important that the
negotiations proceed in a confidential manner. We have submitted
requests for confidentiality agreements to the City and State so
that detailed negotiations may proceed."
Harrah's Jazz Company also responded to statements by State and
City officials that Harrah's Jazz Company has failed to meet
deadlines imposed by the State and City to present a plan of
reorganization. "Harrah's Jazz Company is operating under the
protection and control of the federal bankruptcy court, which has
control over the schedule for the reorganization. When credit
committees are formed in January and appropriate confidentiality
agreements are executed, the parties will be able to move forward
toward completion of a suitable plan of reorganization to submit to
the court," said Mr. Reed.
/CONTACT: Ralph Berry, Harrah's Entertainment, Inc., 901-762-8629/