Harbinger Group Inc.
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SEC Filings

10-K
HRG GROUP, INC. filed this Form 10-K on 12/21/1995
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<PAGE>
 
                               ZAPATA CORPORATION
 
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
 
NOTE 5. DISCONTINUED NATURAL GAS GATHERING, PROCESSING AND MARKETING
       OPERATIONS--(CONTINUED)
  In September 1993, Cimarron acquired the natural gas gathering and processing
plant interests of Stellar Energy Corporation and three affiliated companies
(collectively, "Stellar") for approximately $16.4 million. The acquisition was
financed through the use of working capital cash and assumption of certain
indebtedness of Stellar. Zapata accounted for the acquisition using the
purchase method of accounting and recorded $5.5 million of goodwill in
connection therewith. The goodwill was being amortized over 20 years.
 
 Proposed Disposition
 
  In late 1994 and early 1995, the Company developed a strategic plan that
calls for the divesture of substantially all of the Company's remaining energy
operations including Cimarron. Although a sales price for Cimarron has not been
determined, the Company estimates that, based on preliminary indications of
interest from potential purchasers, the sales price for Cimarron should be at
least book value. The Company expects to complete the sale of Cimarron in
fiscal 1996.
 
  The consolidated financial statements have been restated to report the net
assets and operating results of Cimarron's operations as a discontinued
operation. Summarized results and financial position of Cimarron's discontinued
operations are shown below (amounts in millions):
 

<TABLE>
<CAPTION>
                                                              YEARS ENDED
                                                             SEPTEMBER 30,
                                                          ---------------------
                                                          1995    1994    1993
                                                          -----  ------  ------
      <S>                                                 <C>    <C>     <C>
      FINANCIAL RESULTS
        Revenues......................................... $67.8  $156.1  $186.3
        Expenses.........................................  69.1   158.4   187.9
                                                          -----  ------  ------
        Loss before taxes................................  (1.3)   (2.3)   (1.6)
        Income tax benefit...............................  (0.5)   (0.8)   (0.5)
                                                          -----  ------  ------
          Net loss*...................................... $(0.8) $ (1.5) $ (1.1)
                                                          =====  ======  ======
</TABLE>

 

<TABLE>
<CAPTION>
                                                                     SEPTEMBER
                                                                        30,
                                                                    -----------
                                                                    1995  1994
                                                                    ----- -----
      <S>                                                           <C>   <C>
      FINANCIAL POSITION
        Current assets............................................. $ 9.6 $13.2
        Other assets...............................................   6.7   7.0
        Property and equipment, net................................  16.9  16.5
                                                                    ----- -----
                                                                     33.2  36.7
                                                                    ----- -----
        Debt.......................................................   2.2   3.8
        Other liabilities..........................................   9.6  10.5
                                                                    ----- -----
                                                                     11.8  14.3
                                                                    ----- -----
        Net book value............................................. $21.4 $22.4
                                                                    ===== =====
</TABLE>

- --------
 * Net loss includes allocations of interest expense on general corporate debt
   of $452,000 in 1995, $932,000 in 1994 and $968,000 in 1993. Interest expense
   was allocated to discontinued operations based on a ratio of net assets to
   be sold to the sum of total net assets of the Company plus general corporate
   debt.
 
                                       37

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