UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 (fee required)
For the quarterly period ended March 31, 2000
[] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (no fee required)
For the transition period to
Commission file number 33-00215
UNITED STATES ANTIMONY CORPORATION
(Name of small business issuer in its charter)
Montana 81-0305822
(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification No.)
P.O. Box 643, Thompson Falls, Montana 59873
(Address of principal executive offices) (Zip code)
|
Registrant's telephone number, including area code: (406) 827-3523
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
YES X No
At May 13 , 2000, the registrant had outstanding 17,475,252 shares of par value $.01 common stock.
PART I-FINANCIAL INFORMATION
ITEM 1. Financial Statements and Supplementary Data
United States Antimony Corporation and Subsidiary
Consolidated Balance Sheets
(Unaudited)
March 31, December 31,
2000 1999
ASSETS
Current assets:
Restricted cash $ 228 $ 227
Inventories 289,706 276,599
Accounts Receivable, less allowance for
doubtful accounts of $30,000 and $50,000,respectively 63,857 60,205
------------ ------------
Total current assets 353,791 337,031
Properties, plants and equipment, net 435,824 452,505
Restricted cash for reclamation bonds 171,816 178,986
------------ ------------
Total assets $ 961,431 $ 968,522
============ ============
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Checks issued and payable $ 97,798 $ 45,544
Accounts payable 463,248 467,596
Accrued payroll and property taxes 219,870 263,667
Accrued payroll and other 62,982 97,751
Judgments payable 41,357 40,645
Accrued debenture interest payable 14,640 14,640
Due to related parties 34,492 42,841
Notes payable to bank, current 177,391 160,395
Note payable to Bobby C. Hamilton, current 93,758 87,596
Accrued reclamation costs, current 236,732 256,000
------------ ------------
Total current liabilities 1,442,268 1,476,675
Notes payable to bank, noncurrent 153,687 165,570
Note payable to Bobby C. Hamilton, noncurrent 1,427,844 1,450,785
Accrued reclamation costs, noncurrent 58,687 58,687
------------ ------------
Total liabilities 3,082,486 3,151,717
------------ ------------
Commitments and contingencies
Stockholders' deficit:
Preferred stock, $.01 par value, 10,000,000 shares authorized:
Series A: 4,500 shares issued and outstanding
(liquidation preference $105,750, at December 31,1999) 45 45
Series B: 750,000 shares issued and outstanding
(liquidation preference $795,000, at December 31, 1999) 7,500 7,500
Series C: 205,996 shares issued and outstanding
(liquidation preference $113,281, at December 31, 1999) 2,060 2,060
Common stock, $.01 par value, 20,000,000 shares authorized;
17,475,252 and 16,900,252 shares issued and outstanding 174,752 169,003
Note receivable from shareholder (15,000)
Additional paid-in capital 14,517,198 4,289,947)
Accumulated deficit (16,807,610) (16,651,750)
------------ ------------
Total stockholders' deficit (2,121,055) (2,183,195)
------------ ------------
Total liabilities and stockholders'deficit $ 961,431 $ 968,522
============ ============
The accompanying notes are an integral part of the consolidated financial statements
|
United States Antimony Corporation and Subsidiary
Consolidated Statements of Operations
for the three-month periods ended March 31, 2000 and 1999 (Unaudited)
March 31, March 31,
2000 1999
Revenues:
Sales of antimony products and other $ 1,173,050 $ 690,302
Cost of antimony production and other 974,230 617,375
------------ ------------
Gross profit 198,820 72,927
Other operating expenses:
Exploration and evaluations 33,272
Care-and-maintenance - Yellow Jacket 27,801 38,864
Sales expense 110,065
General and administrative 177,844 62,120
------------ ------------
315,710 134,256
------------ ------------
Other (income) expense:
Interest expense 41,110 51,142
Interest income and other (2,140) (2,346)
Gain on accounts payable write off (16,440)
------------ ------------
38,970 32,356
------------ ------------
Net loss $ 155,860 $ 93,685
============ ============
Basic net loss per share of common stock $ .01 $ .01
============ ============
Diluted net loss per share of common stock $ .01 $ .01
============ ============
Basic weighted average shares outstanding 17,023,054 13,439,427
============ ============
Diluted weighted average shares outstanding 17,532,753 16,034,252
============ ============
|
The accompanying notes are an integral part of the consolidated financial statements
United States Antimony Corporation and Subsidiary
Consolidated Statements of Cash Flows
for the three-month periods ended March 31, 2000 and 1999 (Unaudited)
March 31, March 31,
2000 1999
Cash flows from operating activities:
Net loss $ (155,860) $(93,685)
Adjustments to reconcile net loss to net cash provided by
(used in) operations:
Depreciation 33,000 37,583
Reclamation costs (19,268)
Issuance of stock for consulting services 78,000
Issuance of stock to employees as compensation 1,050
Provision for doubtful accounts (20,000)
Gain on accounts payable write off (16,440)
Change in:
Restricted cash (1) (1)
Accounts receivable (21,062)
Inventories (13,107) 2,285
Restricted cash for reclamation bonds 7,170
Accounts payable (4,348) 71,830
Accrued payroll and property taxes (43,797) (7,605)
Accrued payroll and other 2,641 9,086
Judgments payable 712 576
Accrued debenture interest payable 5,875
Payable to related parties (8,349) (3,680)
---------- ---------
Net cash provided by (used in) operations: (164,269) 6,874
---------- ---------
Cash flows from investing activities:
Purchase of properties, plant and equipment (16,319) 0
---------- ---------
Net cash used in investing activities (16,319) 0
---------- ---------
Cash flows from financing activities:
Proceeds from issuance of common stock 140,000
Proceeds from notes payable to bank, net 5,113
Payments on notes payable to bank (8,008)
Increase in checks issued and payable 52,254 15,235
Payments on note payable to Bobby C. Hamilton (16,779) (14,101)
---------- ---------
Net cash provided by (used in) financing activities 180,588 (6,874)
---------- ---------
Net change in cash 0 0
Cash, beginning of period 0 0
---------- ---------
Cash, end of period $ 0 $ 0
========== =========
Supplemental disclosures:
Cash paid during the period for interest $ 39,297 $ 38,548
========== =========
Noncash financing activities:
Common stock issued in exchange for note receivable $ 15,000
==========
The accompanying notes are an integral part of the consolidated financial statements.
|
PART I - FINANCIAL INFORMATION, CONTINUED:
UNITED STATES ANTIMONY CORPORATION and SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. Financial Statements:
The interim consolidated financial statements contained herein reflect all adjustments (all of a normal, recurring nature) which, in the opinion of management are necessary for a fair statement of the financial condition, results of operations and cash flows for the periods presented. They have been prepared in accordance with Rule 10-01 of Regulation S-X and do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. Operating results for the three-month period March 31, 2000 are not necessarily indicative of the results that may be expected for the entire fiscal year ending December 31, 2000.
These interim financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company's 1999 Annual Report on Form 10-KSB.
2. Notes to December 31, 1999 consolidated financial statements:
The notes to the consolidated financial statements as of December 31, 1999, as set forth in the Company's 1999 Annual Report on Form 10-KSB, substantially apply to these interim consolidated financial statements and are not repeated here. All financial statments presented herein are unaudited. However, the balance sheet as of December 31, 1999, was derived from the audited consolidated balance sheet referred to in Note 1 above. Certain consolidated financial statement amounts for the three-month period ended March 31, 1999, have been reclassified to conform to the 2000 presentation. These reclassifications had no effect on the net loss or accumulated deficit as previously reported.
3. Inventories:
Inventories consist of ownership in antimony metal, metal in process and finished goods that are stated at the lower of first-in, first-out cost or estimated net realizable value. Since the Company's inventory is a commodity with a sales value that is subject to world prices for antimony that are beyond the Company's control, a significant change in the world market price of antimony could have a significant effect on the net realizable value of inventories.
4. Loss Per Common Share:
Loss per common share amounts are based on the weighted average number of common shares outstanding and diluted earnings per share amounts are based on the weighted average number of common shares outstanding plus incremental shares that would have been outstanding upon the exercise of dilutive common stock warrants or conversion of convertible preferred stock.
Outstanding common stock warrants that are exercisable at prices higher than the average trading value of the Company's stock and, therefore, antidilutive, have no effect on the calculation of basic or diluted weighted average number of shares. Series C preferred stock that is convertible into common stock of the Company and outstanding common stock warrants that are exercisable at prices below the average trading value of the Company's stock are considered in the calculation of diluted weighted average number of shares outstanding.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED:
5. Accounts Receivable:
The Company sells the majority of its accounts receivable to a financing company pursuant to the terms of a factoring agreement. According to the terms of the agreement the receivables are sold with full recourse and the Company assumes all risks of collectibility. The Company maintains an allowance for doubtful accounts receivable based upon the expected collectibility of all trade receivables. The Company's sales of accounts receivable qualify as sales under the provisions of Statement of Financial Standards No. 125 "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities."
6.Commitments and contingencies:
Until 1989, the Company mined, milled and leached gold and silver in the Yankee Fork Mining District in Custer County, Idaho. The metals were recovered by a 150-ton per day gravity and flotation mill, and the concentrates were leached with cyanide to produce a bullion product at the Preachers Cove mill, which is located nine miles north of Sunbeam, Idaho on the Yankee Fork of the Salmon River. In 1994, the U.S. Forest Service, under the provisions of the Comprehensive Environmental Response Liability Act of 1980 (CERCLA), designated the cyanide leach plant as a contaminated site requiring cleanup of the cyanide solution. In 1996, the Company signed a consent decree with the Idaho Department of Environmental Quality relating to completing the reclamation and remediation at the Preachers Cove mill.
The Company also has environmental remediation obligations at its antimony production facility near Thompson Falls, Montana and its abandoned gold mining property (Yellow Jacket) in Lemhi County, Idaho. The Company has accrued amounts on its balance sheet that it estimates will be adequate to fulfill its environmental obligations.
ITEM 2. Management's Discussion and Analysis of Results of Operations and Financial Condition
General
Certain matters discussed are forward-looking statements that involve risks and uncertainties, including the impact of antimony prices and production volatility, changing market conditions and the regulatory environment and other risks. Actual results may differ materially from those projected. These forward-looking statements represent the Company's judgment as of the date of this filing. The Company disclaims, however, any intent or obligation to update these forward-looking statements.
Results of Operations
The Company's operations resulted in a net loss of $155,860 for the three-month period ended March 31, 2000, compared with a net loss of $93,685 for the three-month period ended March 31, 1999.
Total revenues from antimony product sales for the first three months of 2000 were $1,173,150 compared with $690,302 for the comparable period in 1999. The increase in revenues during 2000 was due to the Company's independent sale of its antimony products without the participation of an affiliated company that had been associated with the Company during the first quarter of 1999 (see below). Sales of antimony products during the first three months of 2000 consisted of 1,247,589 pounds at an average sale price of $.97 per pound. During the first quarter of 1999 sales of antimony products consisted of 684,322 pounds at an average sale price of $1.01 per pound. The decrease in sale prices of antimony products from the first quarter of 1999 to the first quarter of 2000 is the result of a corresponding decrease in antimony metal prices. The increase in pounds sold during the first quarter of 2000 as compared to the first quarter of 1999 was again due to the Company's independent sale of its antimony products during 2000.
ITEM 2. Management's Discussion and Analysis of Results of Operations and Financial Condition, Continued:
Cost of antimony products sold during the first quarter of 2000 averaged $0.78 per pound as compared to $0.90 per pound during the first quarter of 1999, the decrease in cost of sales of antimony products from the first quarter of 1999 to the first quarter of 2000 is the result of a corresponding decrease in antimony metal prices.
During the first quarter of 1999 the Company reported 50% of total antimony sales made by BCS, its sales affiliate, and the Company. Total sales of antimony products by both companies was $1,380,603 or 1,368,644 pounds during the first three months of 1999. Substantially all of the antimony products sold during 1999 and 2000 were produced at the Company's plant near Thompson Falls, Montana. In March of 1999, the Company notified BCS that it was canceling certain operating agreements relating to the sales of antimony products and sharing of profits. In connection with the cancellation, the Company agreed to purchase BCS's share of antimony products inventory and operate the production and sales of antimony products independently. On March 31, 1999, the Company consummated the transaction and began operating the antimony business on its own.
Costs related to the care-and-maintenance of Yellow Jacket were $27,801 for the three-month period ended March 31, 2000, compared with costs of $38,864 during the three-month period ended March 31, 1999. The decrease in cost was primarily due to the reversal of approximately $17,000 in accrued property taxes due an Idaho County during the first quarter of 2000. Exploration and evaluation operations were terminated at the Yellow Jacket during 1999, accordingly, no exploration and evaluation costs were incurred during the first quarter of 2000 compared to $33,272 incurred during the first quarter of 1999.
During the first quarter of 2000 the Company incurred sales expense of $110,065, relating to sales of its antimony products. No sales expense was recognized during the first quarter of 1999, due to the Company's affiliation with a sales company during the first quarter of 1999. During the first quarter of 2000, the Company restructured its sales staffing in a manner that has decreased sales costs in periods subsequent to March 31, 2000.
General and administrative expenses increased $115,724 during the first three months of 2000 compared to the first three months of 1999. The increase was principally due to consulting expense of $78,000 incurred during the first quarter of 2000 that was not incurred during the first quarter of 1999.
Interest expense was $41,110 during three-month period ended March 31, 2000, compared to $51,142 for the first quarter of 1999. The decrease in interest expense is primarily due to the settlement of the Maguire debenture litigation in the third quarter of 1999, and related conversion of debts to common stock of the Company. .
Interest income was $2,140 during the three-month period ended March 31, 2000, compared to $2,346 for the same period in 1999.
During the first quarter of 1999 a gain of $16,440, resulting from the write off of certain accounts payable, was recognized no such gain was recognized for the comparable quarter of 2000.
Financial Condition and Liquidity
At March 31, 2000, Company assets totaled $961,431, and there was a stockholders' deficit of $2,121,055. Stockholders' deficit decreased $62,140 from December 31, 1999, due to the sales of shares of common stock during the first quarter of 2000. In order to continue as a going concern, the Company is dependent upon (1) profitable operations from the antimony division, (2) short and long-term debt financing, and (3) continued availability of equity financing. Without financing and profitable operations, the Company may not be able to meet its obligations, fund operations and continue in existence. There can be no assurance that management will be successful in its plans to improve the financial condition of the Company.
ITEM 2. Management's Discussion and Analysis of Results of
Operations and Financial Condition, continued:
Cash provided by operating activities during the first three months of 1999 was $6,874 compared with cash used of $164,269 during the first three months of 2000. The change in cash from operations from the first quarter of 1999 compared to the same period in 2000 was primarily due to an increase in the net loss and a decrease in accrued payroll taxes during the first quarter of 2000 as compared to the first quarter of 1999. No cash was used in investing activities during the first quarter of 1999 compared to $16,319 used in investing activities related to investment in antimony plant and equipment during the first quarter of 2000.
Cash provided by financing activities was $180,588 during the first quarter of 2000 compared to $6,874 of cash used by financing activities during the comparable period of 1999. The change in cash from financing activities is principally due to the sale of common stock and an increase in checks issued and payable during the first quarter of 2000 as compared to the first quarter of 1999.
Other significant financial commitments for future periods will include:
-Servicing notes payable to bank.
-Servicing the Bobby C. Hamilton note payable.
-Keeping current on property, payroll, and income tax liabilities and accounts payable.
-Fulfilling responsibilities with environmental, labor safety and securities regulatory agencies.
PART II-OTHER INFORMATION
ITEMS 1, 2, 3, 4, and 5 are omitted from this report as inapplicable.
ITEM 6. Exhibits and Reports on Form 8-K
Exhibit No. 10.41 Warrant Issue-Al Dugan January 25, 2000
SIGNATURES
Pursuant to the requirements of Section 13 or 15(b) 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.
UNITED STATES ANTIMONY CORPORATION
(Registrant)
By:/s/ John C. Lawrence Date: May 13, 2000
John C. Lawrence, Director and President
(Principal Executive, Financial and Accounting
Officer)
|
[ARTICLE] 5
[PERIOD-TYPE] 3-MOS [FISCAL-YEAR-END] DEC-31-2000 [PERIOD-END] MAR-31-2000 [CASH] 228 [SECURITIES] 0 [RECEIVABLES] 93857 [ALLOWANCES] (20000) [INVENTORY] 289706 [CURRENT-ASSETS] 353791 [PP&E] 2551434 [DEPRECIATION] (2115610) [TOTAL-ASSETS] 961431 [CURRENT-LIABILITIES] 1442268 [BONDS] 0 [PREFERRED-MANDATORY] 0 [PREFERRED] 9605 [COMMON] 174752 [OTHER-SE] (2305412) [TOTAL-LIABILITY-AND-EQUITY] 961431 [SALES] 1173050 [TOTAL-REVENUES] 1173050 [CGS] 974230 [TOTAL-COSTS] 974230 [OTHER-EXPENSES] 354680 [LOSS-PROVISION] 0 [INTEREST-EXPENSE] 41110 [INCOME-PRETAX] (155860) [INCOME-TAX] 0 [INCOME-CONTINUING] (155860) [DISCONTINUED] 0 [EXTRAORDINARY] 0 [CHANGES] 0 [NET-INCOME] (155860) [EPS-BASIC] (.01) [EPS-DILUTED] (.01) |
Warrant No. Series 2000-01Warrant to Purchase 300,000 Common Shares
STOCK PURCHASE WARRANT
(For the Purchase of Shares of a Par Value of $.01 Per Share)
UNITED STATES ANTIMONY CORPORATION
(Incorporated under the laws of the State of Montana)
Void After 9:00 AM on 25 January 2003
This is to certify that, for the value received, Al W. Dugan,1415 Louisiana, Suite 3100, Houston, Texas 77002 is entitled, subject to the terms and conditions hereinafter set forth, to purchase the number of Unregistered Common Shares as set forth above, with a par value of $.01 per share, hereinafter called Unregistered Common Shares, of United States Antimony Corporation, hereinafter called the Company, at an exercise price of $.25 per share, and to receive a certificate or certificates for the Unregistered Common Shares so purchased, upon presentation and surrender to the Company, with the form of subscription duly executed, and accompanied by the payment of the purchase price of each share purchased either in cash or by certified or bank cashier's check payable to the order of the Company.
The Company covenants and agrees that all shares which may be delivered upon the exercise of this Warrant will, upon delivery, be free from all taxes, liens and charges, will be fully paid and non-assessable, and the Company further covenants and agrees that it will from time-to-time take all such action as may be requisite to assure that the par value per share of the Common Shares is at all time equal to or less than the current Warrant purchase price per share of the Unregistered Common Shares issuable pursuant to this Warrant.
The purchase rights represented by this Warrant are exercisable at the option of the registered owner hereof in whole at any time, or in part from time-to-time, within the period above stated, provided, however, that such purchase rights shall not be exercisable with respect to a fraction of a share of Common Shares.
In case of the purchase of less than all shares purchasable under this
warrant, the Company shall cancel this Warrant upon the surrender hereof and
shall execute and deliver a new Warrant of like tenor and date for the balance
of the shares purchasable hereunder.
The Company agrees at all times to reserve and hold available a
sufficient number of Unregistered Common Shares to cover the number of shares
issuable upon the exercise of this and all other similar Warrants then
outstanding.
This Warrant shall not entitle the holder hereof to any voting rights or other rights as a shareholder of the Corporation, or any other rights whatsoever, except the rights herein expressed and such as are set forth, and no dividends shall be payable or accrue in respect of the Warrant or the interest represented hereby or the shares purchasable hereunder until or unless, and except to the extent that, this Warrant shall be exercised.
This warrant and the rights represented hereby may not be transferred except by way of gift to family members and family entities, such as trusts or foundations.
In any of the following events, occurring hereafter and until the expiration of the Warrant by the passage of time or the full exercise hereof, appropriate adjustments shall be made in the number of shares deliverable upon the exercise of this Warrant or the price per share to be paid so as to maintain the proportion of interest of each Warrant holder. If the Company at any time prior to the expiration of the Warrants and prior to the exercise thereof declares a dividend on the Common Stock of the Company, payable in Common Stock or securities convertible into Common Stock, or divides, consolidates or reclassifies the Common Stock, whether upon a recapitalization or otherwise, or merges or consolidates with or into another Corporation (unless the Company is the continuing Corporation and there is no reclassification or change of outstanding shares of Common Stock) the number of Common Shares issuable upon exercise of this Warrant shall thereafter (until further adjusted), consist of the kind and amount of securities or property which would have been issuable had the Warrants been exercised immediately prior to the record date for the event in question. The Company shall not affect any such merger or consolidation unless, at or prior to the consumption thereof, the surviving Corporation shall assume by written agreement the obligation to deliver these securities which, and accordance with the foregoing, the Warrant holder is entitled to purchase. The above provisions relative to dilution shall not apply to any issuance or sale by the Company of any of its securities, or any securities convertible into Common Stock, which issuance and sale was for valid consideration as determined by the Board of Directors of the Company and the Company shall be free to offer and sell during the term of this Warrant such of its securities as it may deem advisable and appropriate.
Upon receipt by the Company of evidence satisfactory to it (in the exercise of its reasonable discretion) of the ownership of and the loss, theft, destruction or mutilation of this Warrant and (in the case of loss, theft, or destruction) of indemnity satisfactory to it, and (in the case of mutilation) upon surrendering this Warrant for cancellation, the Company will execute and deliver, in lieu thereof, a new Warrant for like tenor.
The Warrants represented by this certificate and the shares underlying issuable upon exercise hereof, have not been registered under the Securities Act of 1933. The Warrants have been purchased for investment and not with a view to distribution or resale, they may not be made subject to security interest, pledged, hypothecated. The warrant may not be transferred except by way of gift to family members and family entities, such as trusts or foundations. Shares issuable upon exercise of this warrant will have been purchased by the holder thereof for investment and not with a view to distribution or resale, or otherwise transferred without an effective registration statement pursuant to the Securities Act of 1933, or an opinion of counsel acceptable to counsel for the Company that registration is not required under such Act. Any shares issued upon the exercise of this Warrant shall bear a restrictive legend in substantially the following form:
"No sale offer to sell or transfer of the shares represented by this certificate shall be made unless a registration statement under the Securities Act of 1933, as amends, with respect to such shares is then in effect or an exemption from the registration requirements of such Act is then in fact applicable to such shares."
All notices and other communications from the Company to the holder of this Warrant shall be mailed by first class mail, postage prepaid, to the address furnished to the Company in writing by the holder of this Warrant.
Dated: 25 January 2000
UNITED STATES ANTIMONY CORPORATION
By
John C. Lawrence, President
ATTEST:
Lee Martin