-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Lhg6x/hqboGgtfHRzU4x8cTiLPdQebvbQ7kKY6OXR83jVSA0XVHsV6BuPoq5g25w rX3vrylGUyfgTT2KgrqL/Q== 0000916641-99-000954.txt : 19991216 0000916641-99-000954.hdr.sgml : 19991216 ACCESSION NUMBER: 0000916641-99-000954 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991031 FILED AS OF DATE: 19991215 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ST GEORGE METALS INC CENTRAL INDEX KEY: 0000848626 STANDARD INDUSTRIAL CLASSIFICATION: GOLD & SILVER ORES [1040] IRS NUMBER: 880227915 STATE OF INCORPORATION: NV FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-18616 FILM NUMBER: 99774605 BUSINESS ADDRESS: STREET 1: 125 NATIONSBANK CENTER CITY: RICHMOND STATE: VA ZIP: 23219 BUSINESS PHONE: 7139774471 MAIL ADDRESS: STREET 1: 125 NATIONSBANK PLAZA CITY: RICHMOND STATE: VA ZIP: 23219 10QSB 1 3RD QUARTER REPORT SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 1O-QSB Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarter Ended October 31, 1999 Commission File Number 0-18616 - -------------------------------------- ------------------------------ ST. GEORGE METALS, INC. ------------------------------------------------------ (Exact name of registrant as specified In its charter) Nevada 88-0227915 - ------------------------------- --------------------------------------- (State or other jurisdiction of (I.R.S. Employer Identification Number) Incorporation or organization) 125 Bank of America Plaza, 1111 E. Main St., Richmond, Virginia 23219 - ----------------------------------------------------------- ---------- (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (804) 644-3434 -------------- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 ----- ----- As of October 31, 1999, the number of shares of Common Stock outstanding was 14,487,159. NOTE: The information presented in this Form 10-QSB is unaudited, but in the opinion of management reflects all adjustments (which include only normal recurring adjustments) necessary to fairly present such information. ST. GEORGE METALS, INC. FORM 10-QSB QUARTER ENDED OCTOBER 31, 1999 INDEX PAGE ---- PART I - FINANCIAL INFORMATION Interim Consolidated Balance Sheets................................ 3 Interim Consolidated Statement of Income and Deficit............... 4 Interim Consolidated Statement of Cash Flows....................... 5 Notes to the Interim Consolidated Financial Statements............. 6 Management's Discussion and Analysis of Financial Condition and Results of Operations.......................................... 7 PART II - OTHER INFORMATION Items 1 - 6........................................................ 8-9 Signatures......................................................... 10 -2- ST. GEORGE METALS, INC. (A DEVELOPMENT STAGE COMPANY) INTERIM CONSOLIDATED BALANCE SHEETS AS OF OCTOBER 31, 1999 AND JANUARY 31, 1999 (EXPRESSED IN THOUSANDS OF U.S. DOLLARS)
OCTOBER 31, JANUARY 31, 1999 1999 ----------- ---------- ASSETS CURRENT Cash $ 5 $ 6 OTHER - Reclamation deposit 80 80 ----------- ---------- $ 85 $ 86 LIABILITIES CURRENT Accounts payable $ 18 $ 52 Advances from shareholders 552 562 Accrued interest payable 3,987 3,371 Accrued mineral interests reclamation costs 90 90 ----------- ---------- 4,647 4,075 LONG TERM-DEBT Other 1,888 1,888 Related parties 5,043 5,057 ----------- ---------- TOTAL LIABILITIES 11,578 11,020 SHAREHOLDERS' DEFICIT SHARE CAPITAL Authorized 10,000,000 Preferred shares - Par value $.01 per share 30,000,000 Common shares - Par value $.01 per share Issued and paid in capital 1,450 Series A Preferred shares 1,450 1,450 166,417 Series B Preferred shares 499 499 14,487,159 Common shares 9,285 9,285 Deficit accumulated during development stage (22,727) (22,168) ----------- ---------- (11,493) (10,934) ----------- ---------- TOTAL 85 $ 86 ----------- ---------- PREPARED BY MANAGEMENT -3- ST. GEORGE METALS, INC. (A DEVELOPMENT STAGE COMPANY) INTERIM CONSOLIDATED STATEMENT OF INCOME AND DEFICIT FOR THE THREE MONTHS AND NINE MONTHS ENDED OCTOBER 31, 1999 AND 1998 (EXPRESSED IN THOUSANDS OF U.S. DOLLARS) THREE MONTHS NINE MONTHS ENDED OCT. 31 ENDED OCT. 31 1999 1998 1999 1998 --------------------------------------------------------- REVENUE Option fees - 45 15 45 -------- -------- -------- -------- ADMINISTRATION COSTS General and administrative 6 2 7 6 Interest 279 196 603 536 Reclamation and other costs (24) - (42) 171 Professional fees 7 6 9 28 -------- -------- -------- -------- TOTAL ADMINISTRATIVE COSTS 268 204 577 741 --------- ------- --------- -------- NET LOSS BEFORE INTEREST INCOME 268 159 562 696 INTEREST INCOME 1 1 3 7 -------- -------- -------- -------- NET LOSS 267 158 559 689 DEFICIT BEGINNING OF PERIOD 22,460 21,859 22,168 21,328 -------- -------- -------- -------- DEFICIT END OF PERIOD 22,727 22,017 22,727 22,017 -------- -------- -------- -------- BASIC LOSS PER SHARE IN U.S. DOLLARS $ .02 $ .01 $ .04 $ .05 -------- -------- -------- -------- WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 14,487,159 14,487,159 14,487,159 14,487,159 ---------- ---------- ---------- ---------- PREPARED BY MANAGEMENT -4- ST. GEORGE METALS, INC. (A DEVELOPMENT STAGE COMPANY) INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED OCTOBER 31, 1999 AND 1998 (EXPRESSED IN THOUSANDS OF U.S. DOLLARS) NINE MONTHS ENDED OCTOBER 31, 1999 1998 ---------------------------------- FUNDS PROVIDED (USED) BY OPERATING ACTIVITIES Net loss recovery $ (559) $ (689) CHANGES IN OTHER WORKING CAPITAL ITEMS 572 751 ----------- ----------- TOTAL 13 62 ----------- ----------- FINANCING ACTIVITIES Long-term debt (14) (54) ----------- ----------- NET INCREASE (DECREASE) IN CASH (1) 8 CASH BALANCE BEGINNING OF PERIOD 6 4 ----------- ----------- CASH BALANCE END OF PERIOD $ 5 $ 12 ----------- -----------
PREPARED BY MANAGEMENT -5- ST. GEORGE METALS, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS OCTOBER 31, 1999 (EXPRESSED IN THOUSANDS OF U.S. DOLLARS) 1. ACCOUNTING POLICIES These interim consolidated financial statements have been prepared in accordance with accounting principles and practices that are generally accepted in the United States. The notes to the Company's (unaudited) consolidated financial statements as of January 31, 1999, substantially apply to the interim financial statements at October 31, 1999, and are not repeated here. 2. INTERIM ADJUSTMENTS The unaudited interim financial information reflects all adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim period presented. These adjustments are of a normal recurring nature. 3. STATUS OF BUSINESS The Company is not engaged in any active business. There was no change during the quarter ending October 31, 1999, with respect to the Company's continuing efforts to reach an out-of-court accord with its trade creditors. See Item 5, Other Information, of Part II of this Form 10-QSB. PREPARED BY MANAGEMENT -6- Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations - Financial Revenues. The Company had no revenues during the quarter ended October 31, 1999. It had revenues of $15,000 from one option payment during the comparable period in the preceding year. For the nine months ended October 31, 1999, the Company had revenues of $15,000 compared to $45,000 during the nine months ended October 31, 1998. Costs and Expenses. During the quarter ended October 31, 1999, the Company had total administrative costs of $268,000 compared to $204,000 in the comparable period in the prior year. The Company had a recovery on reclamation costs during the period of $24,000. There were no reclamation costs or recovery during the comparable period in the preceding year. Accrued interest was $279,000 during the period, compared to $196,000 during the quarter ended October 31, 1998. For the nine months ended October 31, 1999, total administrative costs were $577,000 compared to $741,000 in the comparable period ended October 31, 1998. Interest Income. The Company had interest income during the period of $1,000, compared to $1,000 during the comparable period in the preceding year. Net Loss. The Company had a net loss for the quarter ended October 31, of $267,000 (or $.02 per share), compared to $158,000 (or $.01 per share) for the comparable period in the prior year. For the nine months ended October 31, 1999, the Company had a net loss of $559,000 ($.04 per share) compared to $689,000 ($.05 per share) in the nine months ended October 31, 1998. Analysis of Financial Condition The Company had no material liquidity or capital resources at quarter ended October 31, 1999. At that date, the Company had current assets of $5,000 and current liabilities of $4.6 million. Current liabilities include $4.0 million of accrued interest payable which is in arrears. A substantial portion of the Company's current liabilities and other indebtedness is owed to related parties. The Company obtained no new financing during the three-month period ended October 31, 1999. The Company continues to seek to satisfy its trade creditors and other operational expenses other than through a court supervised process. The Company does not presently expect to be in a position to make any payments on its Operations Advances (which are payable solely from net cash flow from the Company's now-terminated Dean Mine operations) or on its Gold Delivery Contracts and $4.3 million principal amount of term debt, both of which categories have been voluntarily subordinated by the holders to the payment of the Operations Advances. -7- PART II - OTHER INFORMATION Item 1. Legal proceedings. (a) See Item 5 below. Item 2. Changes in securities. (a) None (b) None Item 3. Defaults upon senior securities. Under the Company's Phase I and II Loan Commitments, non-payment of interest constitutes an event of default; however, a note holder must advise the Company in writing that he declares his debt to be in default. As previously reported, two note holders, one a former related party of the Company, advised the Company in January, 1994, that the Company was in default with respect to the Company's debt obligations to them. The Company advised such holders that it did not agree with their position. Item 4. Submission of matters to a vote of security holders. None Item 5. Other information. General. The Company's financial resources have been substantially exhausted and management does not know of any significant additional financing available to the Company. The Company has no continuing on-going business operations at this time. The Company has been seeking, since early 1995, to satisfy its trade debt other than through a court supervised process, which would entail significant administrative expenses. The Company has been able to satisfy a substantial portion of its trade debt, but in light of its financial position, it is unlikely any payments will be made on its other indebtedness, which has been voluntary subordinated to the Company's trade creditors. SEC Reporting Obligations. Because of the Company's financial condition and its consequent difficulty paying the attendant legal and accounting expenses, its ability to continue to meet its reporting obligations under the Securities Exchange Act of 1934 remains questionable. The financial statements included with its Form 10-KSB for the year ended January 31, 1999, were not audited by an independent certified accountant, because the Company could not afford the cost of an audit. The Company sought and obtained administrative relief from the staff of the Securities and Exchange Commission from the requirement that it obtain an audited financial statement for its Form 10-KSB filing. -8- Inability to Pay Indebtedness. Management does not presently anticipate that any of its outstanding obligations under its Operations Advances, Gold Delivery Contracts and term debt, a substantial portion of which outstanding obligations are held by members of the Company's board of directors, can be satisfied. Accordingly, management does not believe, as a practical matter, that there is any remaining value to be ascribed to the Company's outstanding preferred stock or common stock. Status of Properties. As previously reported, during the quarter ended July 31, the Company entered into a verbal agreement whereby it agreed to quit-claim any interest it may have in the Hancock Canyon (58 claims) and Trenton Canyon (31 claims) properties in exchange for a full release from Sierra Mining & Engineering L.L.C. ("SME") and its owner, James Golden, for any and all work performed by SME in connection with the reclamation of the Company's formerly leased Dean Mine property or in any other respect. This conveyance and settlement was finalized as of August 30, 1999. The Hancock Canyon property had previously been under option to Cameco (U.S.) Inc., as described in the Company's Form 10-KSB for the year ended January 31, 1999, but as previously disclosed that option was terminated by the optionee in April 1998. The Company has previously terminated a lease it held on the Trenton Canyon properties, but had staked over that property. The Company no longer has the financial resources to pay the necessary annual renewal fees to hold onto those claims. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits: Exhibit 27 Financial Data Schedule, filed herewith. (b) Reports on Form 8-K: None -9- 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. St. George Metals. Inc. ---------------------------------------- (Registrant) December 15, 1999 By: /s/ C. B. Robertson, III - ----------------- -------------------------- C. B. Robertson, III - Chairman and Principal Executive Officer December 15, 1999 /s/ Harrison Nesbit, II - ----------------- ----------------------- Harrison Nesbit, II - Treasurer and Chief Financial and Accounting Officer -10- EX-27 2 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNAUDITED FINANCIAL STATEMENTS OF ST. GEORGE METALS, INC. (A DEVELOPMENT STAGE COMPANY) INCLUDED IN ITS FORM 10-QSB FOR THE QUARTER ENDED OCTOBER 31, 1999 1,000 9-MOS JAN-31-1999 OCT-31-1999 5 0 0 0 0 5 0 0 85 4647 6931 0 1949 9285 (22727) 0 0 0 0 268 0 0 279 (267) 0 (267) 0 0 0 (267) (.02) (.02)
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