<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR QUARTERLY PERIOD ENDED MARCH 31, 2000
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. 0-24259
AUSTRALIAN-CANADIAN OIL ROYALTIES, LTD.
(Exact Name of Registrant as Specified in its Charter)
British Columbia, Canada 75-2712845
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification #)
1304 Avenue L, Cisco, TX 76437
(Address of Principal Executive Offices) (Zip Code)
(254) 442-2658
Registrant's Telephone Number Including Area Code
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 [X] Yes [ ]
NO
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
There were 5,150,000 shares of common stock, $.001 Par Value,
outstanding as of March 31, 2000
Transitional Small Business Disclosure Format; [ ] Yes [X] No
1
<PAGE>
<PAGE>
INDEX
Page
Part I. Financial Information
Item 1. Financial Statements
Report on Review by Independent Certified
Public Accountants . . . . . . . . . . . 3
Balance Sheet. . . . . . . . . . . . . . 4
Statement of Operations . . . . . . . . . . 5
Statement of Cash Flows . . . . . . . . . . 6
Selected Information Regarding the Financial
Statements . . . . . . . . . . . . . . 7
Item 2. Management's Discussion and Analysis and Plan
of Operations. . . . . . . . . . . . 8
Part II: Other information
Item 6: Exhibits and Reports on Form 8-K . . . . . 9
Signatures . . . . . . . . . . . . . . . . 9
2
<PAGE>
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
REPORT ON REVIEW BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
Australian-Canadian Oil Royalties, LTD.
Cisco, Texas
We have reviewed the accompanying balance sheet of Australian-Canadian Oil
Royalties, LTD. as of March 31, 2000, and the related statements of
operations and cash flows for the three months ended March 31, 2000 and
1999. These financial statements are the responsibility of the Company's
management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical review
procedures to financial data and making inquiries of persons responsible
for financial and accounting matters. It is substantially less in scope
than an audit conducted in accordance with generally accepted auditing
standards, the objective of which is the expression of an opinion
regarding the financial statements taken as a whole. Accordingly, we do
not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the accompanying consolidated financial statements for
them to be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the balance sheet as of December 31, 1999, and the related
statements of operations, changes in stockholders' equity, and cash flows
for the year then ended (not presented herein); and in our report dated
April 10, 2000, we expressed an unqualified opinion on those financial
statements. In our opinion, the information set forth in the accompanying
condensed balance sheet as of December 31, 1999 is fairly stated in all
material respects in relation to the balance sheet from which it has been
derived.
/s/ Robert Early & Company, P.C.
Robert Early & Company, P.C.
Abilene, Texas
May 12, 2000
3
<PAGE>
<PAGE>
AUSTRALIAN-CANADIAN OIL ROYALTIES, INC.
BALANCE SHEETS
March 31, December 31,
2000 1999
----------- -----------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 241,092 $ 246,152
Royalties receivable 942 1,575
Prepaid expenses and other 1,653 1,654
----------- -----------
Total Current Assets 243,687 249,381
----------- -----------
PROPERTY AND EQUIPMENT
Oil and gas properties 308,966 308,966
Accumulated depletion (11,866) (10,426)
----------- -----------
Total Property and Equipment 297,100 298,540
----------- -----------
OTHER ASSETS
Investment in Cooper Basin Oil & Gas, Inc. 4,212 4,212
Organization costs 2,645 2,645
Accumulated amortization (1,587) (1,455)
----------- -----------
Total Other Assets 5,270 5,402
----------- -----------
TOTAL ASSETS $ 546,057 $ 553,323
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable, trade $ 4,295 $ 1,279
----------- -----------
STOCKHOLDERS' EQUITY
Common stock (50,000,000 shares authorized;
no par value; 5,150,000 shares issued
and outstanding) 612,348 611,448
Accumulated deficit (70,433) (59,251)
Other comprehensive income:
Foreign currency translation adjustment (153) (153)
----------- -----------
Total Stockholders' Equity 541,762 552,044
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 546,057 $ 553,323
=========== ===========
See accountants' report and accompanying selected information.
4
<PAGE>
<PAGE>
AUSTRALIAN-CANADIAN OIL ROYALTIES, INC.
STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2000 and 1999
2000 1999
----------- -----------
OIL AND GAS REVENUES $ 2,019 $ 1,194
COST OF SALES
Depletion 1,441 239
----------- -----------
GROSS PROFIT 578 955
----------- -----------
OPERATING EXPENSES
Personnel costs 8,577 1,684
Professional fees 726 693
Other 4,751 181
----------- -----------
Total Operating Expenses 14,054 2,558
----------- -----------
OPERATING LOSS (13,476) (1,603)
OTHER INCOME
Interest and dividends 2,900 877
----------- -----------
NET LOSS BEFORE INCOME TAXES (10,576) (726)
Australian income taxes (606) (358)
----------- -----------
NET LOSS $ (11,182) $ (1,084)
=========== ===========
BASIC (LOSS) PER COMMON SHARE $ (0.00) $ (0.00)
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING:
Basic 5,150,000 5,150,000
See accountants' report and accompanying selected information.
5
<PAGE>
<PAGE>
AUSTRALIAN-CANADIAN OIL ROYALTIES, INC.
STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 2000 and 1998
Increase/(Decrease) in Cash and Cash Equivalents
2000 1999
----------- -----------
CASH FLOWS (USED IN) OPERATING ACTIVITIES
Net (loss) $ (11,182) $ (1,084)
Adjustments to reconcile net (loss) to cash
(used in) operating activities:
Depletion and amortization 1,573 371
Expenses contributed by officer 900 900
Change in current assets:
Royalties receivable 633 50
Change in current liabilities:
Accounts payable 3,016 (1,521)
----------- -----------
Net Cash (Used In) Operating Activities (5,060) (2,184)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in subsidiary - Cooper Basin
Oil and Gas, Inc. - (2,112)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES - -
----------- -----------
NET INCREASE IN CASH (5,060) (4,296)
CASH, BEGINNING OF PERIOD 246,152 263,188
----------- -----------
CASH, END OF PERIOD $ 241,092 $ 258,892
=========== ===========
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest and Income Taxes Paid
Income taxes $ 880 $ 468
Interest expense - -
See accountants' report and accompanying selected information.
6
<PAGE>
<PAGE>
AUSTRALIAN-CANADIAN OIL ROYALTIES, LTD.
SELECTED INFORMATION FOR FINANCIAL STATEMENTS
(Unaudited)
March 31, 2000
NOTE 1: BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions of Regulation S-B. They
do not include all information and footnotes required by generally
accepted accounting principles for complete financial statements. However,
except as disclosed herein, there has been no material change in the
information included in the Company's Report on Form 10-SB for the year
ended December 31, 1999. In the opinion of Management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. The report of Robert Early and Company,
P.C. commenting on their review accompanies the condensed financial
statements included in Item 1 of Part 1. Operating results for the three
month period ended March 31, 2000, are not necessarily indicative of the
results that may be expected for the year ending December 31, 2000.
NOTE 2: APPLICATION FOR CONCESSION
During the first quarter of 2000, the Company's secretary spent a
significant amount of time in Australia on behalf of the Company
coordinating the responses to followup requirements for an application for
an offshore concession. This activity was not successful. Travel costs,
included in Other Expenses amounted to $3,590 while costs for contract
services related to this effort, included in personnel costs, were
approximately $6,000.
NOTE 3: CONTRIBUTED EXPENSES
Officers of the Company have not been paid for their services.
Addtionally, the Company has not established an office separate from that
of its officers. The value of the officers' unpaid services and office
space utilization have currently been estimated at $600 and $300 per
quarter. These costs have been recorded as expenses and as additional
capital.
7
<PAGE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
On May 8, 2000 the Company received a letter from the Joint Authority of
the State of Victoria and the Commonwealth of Australia advising that ACOR
was not the successful applicant on their application for V99-2. Liberty
Petroleum Corporation is the successful applicant and ACOR is currently
under discussions with Liberty regarding an interest in V99-2.
Randy Hastings, Consultant just arrived back from Australia with
additional information on the South Australian concession areas. The
seismic sections on all of the areas have been ordered, but not yet
received.
Liquidity
The liquidity on March 31, 2000 was 42 times as much cash on hand as
liabilities. The Company's cash in bank as of March 31, 2000 was $241,092,
compared to $246,152 on March 31, 1999, a decrease of $5,694.
Capital Resources
The above $5,694 was primarily spent on travel expenses for the meeting
with the Government's on the application for V99-2, plus accounting fees
for the preparation of the Form 10-KSB.
Results of Operations
The Company raised a $US 20,000,000 performance bond for the application
on V99-2 and exploration money commitment of $A 92,000,000 for a six year
period. Our deal to finance the work program required giving up a 75%
Working Interest and retaining a 6% Overriding Royalty Interest and a 25%
Carried Working Interest out of the area. Liberty Petroleum wants a
different type of deal. ACOR wants to trade stock for a carried working
interest.
Our current operations are to apply for the eight new areas in South
Australia, although only one of the areas will be issued per applicant.
These areas are out of the former PEL's 5 & 6, which were held by the
Santos-Exxon group, and adjoin production.
Recent Accounting Pronouncements
In June, 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standard No. 133, "Accounting for
Derivative Instruments and Hedging Activities" (SFAS 133). This statement
standardized the accounting for derivative instruments including certain
derivative instruments embedded in other contracts, requiring that an
entity recognize those items as assets or liabilities in the statement of
financial position and measure them at fair value. The statement generally
provides for matching the timing of gain or loss recognition on the hedged
instrument with the recognition of (a) the changes in fair value of the
hedged assets or liabilities that are attributable to the hedged risk, or
(b) the earning effect of the hedged transaction. The statement is
effective for all fiscal quarters of all fiscal years beginning after June
15, 1999, with earlier application encouraged, and shall be a0pplied
retroactively to financial statements of prior periods. Adoption of SFAS
133 is expected to have no effect on the Company's financial statements.
Disclosure Regarding Forward-Looking Statements
The forward-looking statements in this Form 10-QSB reflect the Company's
current views with respect to future events and financial performance.
These forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ from those
anticipated. In the Form 10-QSB, the words "anticipates", "believes",
"expects", "intends", "future" and similar expressions identify
forward-looking statements. The Company undertakes no obligation to
publicly revise these forward-looking statements to reflect events or
circumstances that may arise after the date hereof. All subsequent written
or oral forward-looking attributable to the Company or persons acting on
its behalf qualified in their entirety by this section.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
None
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Australian-Canadian Oil
Royalties, LTD.
Date: May 15, 2000 /s/ Robert Kamon
By: Robert Kamon, Secretary
and Principal Financial Officer
<PAGE>
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> The following schedule contains summary financial information
which has been extracted from the financial statements of
Australian-Canadian Oil Royalties LTD.s for the quarterly financial
statements filed on Form 10QSB for the period presented. These summary
schedules are qualified in their entirety by reference to such financial
statements and the notes thereto.
</LEGEND>
<CIK> 0001061288
<NAME> AUSTRALIAN-CANADIAN OIL ROYALTIES
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 241,092
<SECURITIES> 0
<RECEIVABLES> 942
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 243,687
<PP&E> 308,966
<DEPRECIATION> (11,866)
<TOTAL-ASSETS> 546,057
<CURRENT-LIABILITIES> 4,295
<BONDS> 0
0
0
<COMMON> 612,348
<OTHER-SE> (70,586)
<TOTAL-LIABILITY-AND-EQUITY> 546,057
<SALES> 2,019
<TOTAL-REVENUES> 2,019
<CGS> 1,441
<TOTAL-COSTS> 578
<OTHER-EXPENSES> 14,054
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (10,576)
<INCOME-TAX> 606
<INCOME-CONTINUING> (11,182)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (11,182)
<EPS-BASIC> (0.00)
<EPS-DILUTED> (0.00)
