<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
NOTE 9. INCOME TAXES--(CONTINUED)
Temporary differences and tax credit carryforwards that gave rise to
significant portions of deferred tax assets and liabilities as of September 30,
1994 are as follows:
<TABLE>
<CAPTION>
SEPTEMBER 30, 1994
------------------
(IN THOUSANDS)
<S> <C>
Deferred Tax Assets:
Asset write-downs not yet deductible................ $ 5,150
Investment tax credit carryforwards................. 17,639
Alternative minimum tax credit carryforwards........ 11,683
Other............................................... 2,555
-------
Total deferred tax assets......................... 37,027
Valuation allowance................................. (19,429)
-------
Net deferred tax assets........................... 17,598
-------
Deferred Tax Liabilities:
Property and equipment.............................. (3,477)
Basis difference on stock investment................ (1,650)
Pension............................................. (3,356)
Unrealized investment gain on Tidewater common
stock.............................................. (2,302)
Other............................................... (3,898)
-------
Total deferred tax liabilities.................... (14,683)
-------
Net deferred tax asset............................ $ 2,915
=======
</TABLE>
The valuation allowance represents managements estimates of tax credit
carryforwards that may not be ultimately utilized given current facts and
circumstances. Management believes that the net deferred tax asset will be
realized through future taxable income.
NOTE 10. COMMITMENTS AND CONTINGENCIES
Sales-type leases receivable
Energy Industries provides a capital lease financing option to its customers.
Future minimum lease payments receivable resulting from the sale of compression
packages under sales-type leases are due to Zapata as follows: $3,769,000 in
1995, $241,000 in 1996 and $77,000 in 1997; deferred interest totalling $51,000
is included in such amounts. Energy Industries periodically sells a portion of
its lease receivables. Certain lease receivables are sold with partial recourse
to Energy Industries. At September 30, 1994 the total amount of recourse to
Energy Industries on the unpaid balance of all previously sold lease
receivables was $1.7 million. During 1994, Energy Industries sold a total of
$8.3 million of lease receivables.
Operating leases receivable
Energy Industries maintains a fleet of natural gas compressor packages for
rental under operating leases. At September 30, 1994 the net book value of such
property was $46.3 million (accumulated depreciation totalled $3.5 million).
Future minimum lease payments receivable under remaining noncancellable
operating leases as of September 30, 1994 are as follows: $3,256,000 in 1995,
$782,000 in 1996 and $190,000 in 1997.
Operating leases payable
Future minimum payments under operating lease obligations aggregate $10.7
million, and for the five years ending September 30, 1999 are:
<TABLE>
<CAPTION>
1995 1996 1997 1998 1999
------ ------ ------ ------ ----
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Lease obligations........................ $3,292 $1,567 $1,353 $1,194 $992
</TABLE>
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