<PAGE>
SECURITIES & EXCHANGE COMMISSION
WASHINGTON D. C. 20549
FORM 1O-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
FOR THE TRANSITION PERIOD FROM ____ TO ___
COMMISSION FILE NO. 1-9904
VANDERBILT GOLD CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 88-0224117
(State of incorporation) (I.R.S. employer
identification no.)
4625 WYNN ROAD, SUITE 103, LAS VEGAS, NV 89103
(Address of principal offices) (Zip code)
Telephone: (702) 362-3152
Indicate by check mark whether the registrant (1) has filed all reports 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 .
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PROCEEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by the court. Yes X No .
--- ---
As of October 31, 1996 there were 34,282,322 shares outstanding.
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VANDERBILT GOLD CORPORATION
Index
Page No
Part I - Financial Information
Item 1. Financial Statements
Consolidated Balance Sheet 3
Consolidated Statement of Operations 4
Consolidated Statement of Cash Flows 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Part 11 - Other Information
Item 1. Legal Proceedings 8
Signatures 9
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VANDERBILT GOLD CORPORATION
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
SEPTEMBER 30, 1996 AND DECEMBER 31, 1995
IN THOUSANDS SEPTEMBER 30, DECEMBER 31,
1996 1995
------------- ------------
ASSETS
------
Current Assets
Cash and cash equivalents $ 1 $ 1
Accounts receivable - Trade 2 2
Employee advances receivable 26 23
Inventories 837 837
Prepaid and other assets 11 6
-------- --------
Total Current Assets 877 869
-------- --------
Property, Plant and Equipment 2,694 2,607
-------- --------
Total Assets $ 3,571 $ 3,476
-------- --------
-------- --------
LIABILITIES AND EQUITY
----------------------
Current Liabilities
Accounts payable $ 1,284 $ 1,202
Accrued expenses 136 171
Accounts payable - Related parties 176 67
Accrued payroll 546 505
Notes payable - Other 33 123
Deferred revenue - Gold sales 95 95
Gold loan payable 38 38
-------- --------
Total Current Liabilities 2,308 2,201
-------- --------
Long Term Liabilities 45 45
-------- --------
Stockholder's Equity: (shares in 000's)
Capital stock (authorized 45,000,000;
issued 34,282 in 1996 and 32,093 in 1995) 343 321
Other capital 25,225 24,964
Accumulated deficit (24,350) (24,055)
-------- --------
Stockholder's Equity 1,218 1,230
-------- --------
Total Liabilities and Equity $ 3,571 $ 3,476
-------- --------
-------- --------
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VANDERBILT GOLD CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
IN THOUSANDS (EXCEPT SHARE AMOUNTS)
1996 1995
-------- --------
Revenue from Sales:
Bullion sales $ - $ 29
Other revenue 32 -
-------- --------
Total Revenue from Sales 32 29
-------- --------
Mining Expenses:
Mine maintenance costs 25 170
Depreciation, depletion and amortization 50 48
Exploration costs 16 113
-------- --------
Total Mining Expenses 91 331
General & Administrative 291 224
-------- --------
Total Expenses 382 555
-------- --------
(Loss) From Operation (350) (526)
-------- --------
Other Income and Expense:
Debt cancellation income 56 53
Dividend income - 1
Interest expense 1 10
-------- --------
Total Other Income and Expense 55 44
-------- --------
Net (Loss) $ (295) $ (482)
-------- --------
-------- --------
Net loss per share $0.01 $0.02
-------- --------
-------- --------
Weighted average shares outstanding 34,033 30,116
-------- --------
-------- --------
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VANDERBILT GOLD CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
IN THOUSANDS (EXCEPT SHARE AMOUNTS)
1996 1995
-------- --------
Revenue from Sales:
Bullion sales $ - $ -
Other revenue 2 -
-------- --------
Total Revenue from Sales 2 -
-------- --------
Mining Expenses:
Mine maintenance costs 4 25
Depreciation, depletion and amortization 17 16
Exploration costs 14 6
-------- --------
Total Mining Expenses 35 47
General & Administrative 98 101
-------- --------
Total Expenses 133 148
-------- --------
(Loss) From Operation (131) (148)
-------- --------
Other Income and Expense:
Dividend income - -
Interest expense - (3)
Debt Cancellation income - 53
Gain (loss) fixed assets - -
Gain on joint venture sale - -
-------- --------
Total Other Income and Expense - 50
-------- --------
Net (Loss) $ (131) $ (98)
-------- --------
-------- --------
Net loss per share $0.00 $0.00
-------- --------
-------- --------
Weighted average shares outstanding 34,282 30,711
-------- --------
-------- --------
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VANDERBILT GOLD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 31, 1996 AND 1995
IN THOUSANDS 1996 1995
-------- --------
OPERATING ACTIVITIES:
Net (Loss) $ (295) $ (482)
Reconciliation to net cash provided (used) for
operating activities:
Depreciation, depletion and amortization 50 48
Receivables - trade - 66
Receivables - related parties (3) -
Inventories - 29
Prepaids and other assets (5) (5)
Accounts payable and accrued liabilities 107 156
-------- --------
Net cash used by operations (146) 188
-------- --------
INVESTING ACTIVITIES;
Additions to property, plant and equipment (3) (57)
-------- --------
Net cash used for investing activities (3) (57)
-------- --------
FINANCING ACTIVITIES
Increase in amounts due related parties - 5
Proceeds from sale of stock 149 89
-------- --------
Net cash provided by financing activities 149 94
-------- --------
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS - (151)
CASH AND EQUIVALENTS, BEGINNING OF PERIOD 1 153
CASH AND EQUIVALENTS, END OF PERIOD $ 1 $ 2
-------- --------
-------- --------
Interest paid - -
Payment of payables with stock 10 -
Purchase mineral property with stock 131 -
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VANDERBILT GOLD CORPORATION
Notes to Consolidated Financial Statements
NOTE 1: INTERIM FINANCIAL STATEMENTS
The accompanying consolidated interim financial statements have not been
audited. In the opinion of the Company's management, the interim financial
statements include all adjustments necessary for the fair presentation of the
results for the interim periods. These adjustments are of a normal recurring
nature. The financial statements, prepared in accordance with the regulations
of the Securities and Exchange Commission (the "SEC"), should be read in
conjunction with the Company's 1995 Annual Report on Form 10-K. Results of
operations for the interim periods are not necessarily indicative of results for
the full year.
Statement of Financial Accounting Standards ("SFAS") No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of'
was issued by the Financial Accounting Standards Board (FASB) in March 1995.
SFAS No. 121 requires, for fiscal years beginning after December 15, 1995, that
an entity review long-lived assets for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable and that an impairment loss be recognized as the amount by which the
carrying amount of the asset exceeds the fair value of the asset. The Company
adopted SFAS No. 121 effective January 1, 1996. The adoption did not have an
effect on the Company's financial position or results of operations.
Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation,' ("SFAS No. 1231 was issued by the Financial Accounting Standards
Board in October 1995. SFAS No. 123 establishes, for fiscal years beginning
after December 15, 1995, financial and reporting standards for stock-based
employee compensation plans. SFAS No. 123 encourages, but does not require, the
adoption of a fair-value-based method of accounting for such plans, in place of
current accounting standards. Companies electing to continue their existing
accounting method must make pro forma disclosures of net income as if the fair-
value-based method of accounting had been applied. The Company has elected to
continue with its existing accounting method and in accordance with SFAS No.
123, will have pro forma disclosures of net income in its financial statements
for the year ending December 31, 1996.
NOTE 2. PROPERTY, PLANT, EQUIPMENT AND MINING PROPERTIES - NET:
Property, plant, equipment and mining properties, accumulated depreciation and
amortization and range of estimated lives as of March31, 1996 and December 31,
1995 are as follows (in thousands):
Lives 1996 1995
----- ---- ----
Units of
Mining properties production $ 8,633 $ 8,501
Plant and equipment 5-10 1,084 1,080
-------- --------
9,717 9,581
Less: Accumulated depreciation and
amortization (7,023) (6,974)
-------- --------
Net property, plant and equipment $ 2,694 $ 2,607
-------- --------
-------- --------
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
GENERAL
The company has focused its efforts on bringing the Los Coloradas mine into
production in Mexico, and getting the Morning Star Mine ready to resume
production. The letter of understanding with Guardian Enterprises Ltd. and
Consolidated Viscount Ltd. the company has expired and the company has not
entered into any other agreements with other parties on the La Sierra Concession
or the Morning Star Mine.
RESULTS OF OPERATIONS:
Comparison of nine months and three months ended September 30, 1996 to nine
months and three months ended September 30, 1995:
The Company realized a net loss of $295,000 ($0.002 per share) for the nine
months ended September 30, 1996 which is $187,000 less than the $482,000 ($0.01
per share) net loss for the nine months ended September 30, 1995. These losses
reflect the facts that the Company was concentrating on reclamation and
remediation activities at the Morning Star Mine ("Mine"). The Company spent
$16,000 on exploration expenses during the period ended September 30, 1996 on
concessions in Mexico contrasted to $113,000 exploration expenditures during the
same period in 1995
LIQUIDITY AND CAPITAL RESOURCES:
The Company's net working capital deficit increased by $175,000 over that of
September 30, 1995. During the nine months ended September 30,1996 operating
losses and additions to property were funded primarily through issuance of stock
for cash and property.
The company has sustained recurring losses from operations and has a significant
working capital deficit. Although the Company raised equity capital from
private placements in 1996, due to the uncertainties regarding its ability to
develop and attain profitable operations and raise capital in the future, there
can be no assurance of the Company's ability to continue as a going concern.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 LEGAL PROCEEDINGS. NONE
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report on Form 10-Q to be signed on its behalf
by the undersigned, thereunto duly authorized.
VANDERBILT GOLD CORPORATION
(Registrant)
Dated November 14, 1996
by /s/ Keith Fegert
Keith Fegert
President and Chief
Financial Officer
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<PAGE>
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<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 1
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<ALLOWANCES> 0
<INVENTORY> 837
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<PP&E> 9,717
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<CURRENT-LIABILITIES> 2,308
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0
0
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<CGS> 91
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<OTHER-EXPENSES> 290
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1
<INCOME-PRETAX> (295)
<INCOME-TAX> 0
<INCOME-CONTINUING> (295)
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<CHANGES> 0
<NET-INCOME> (295)
<EPS-PRIMARY> (.002)
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