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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1999
Commission File No. 0-08507
BLACK GIANT OIL COMPANY
(Exact Name of Small Business Issuer as Specified in its Charter)
Nevada 75-1441442
(State or other jurisdiction of (I.R.S.. Employer I.D. No.)
incorporation or organization)
1301 Avenue M (P.O. Box 31)
Cisco, Texas 76437
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (254) 442 3968
Indicate by check mark whether the issuer (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act 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 NO X
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.
As of August 1, 1999, Signature had outstanding 24,423,477 shares of its common
stock, par value $0.0125 per share.
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PART 1
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The financial statements included herein have been prepared by Black Giant Oil
Company without audit, pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. However, in the opinion of
management, all adjustments (which include only normal recurring accruals)
necessary to present fairly the financial position and results of operations for
the periods presented have been made. The financial statements should be read in
conjunction with the financial statements and notes thereto included in Black
Giant's SEC Form 10-KSB for the period ended March 31, 1999.
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BLACK GIANT OIL COMPANY
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
June 30, March 31,
1999 1999
----------- -----------
(Audited)
<S> <C> <C>
Current assets:
Cash $ 447 $ 119
Prepaids 2,500 5,000
----------- -----------
Total current assets 2,947 5,119
Other assets:
Net assets of discontinued operations (Note 6) 157,593 157,593
----------- -----------
$ 160,540 $ 162,712
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 19,760 $ 18,860
Advances from officer 13,175 13,325
----------- -----------
Total liabilities 32,935 32,185
----------- -----------
Convertible debt (Note 2) 100,010 100,010
Commitments and contingencies (Note 5) -- --
Stockholders' equity:
Preferred stock, $.10 par value, 10,000,000 shares
authorized; none issued and outstanding -- --
Common stock, $.0125 par value, 100,000,000 shares
authorized; 22,262,477 and 19,751,477
shares issued and outstanding 305,293 278,532
Additional paid-in capital 1,303,986 1,314,497
Stock to be issued -- 16,250
Accumulated deficit (1,540,284) (1,537,362)
----------- -----------
68,995 71,917
Less treasury stock (20,070 shares, at cost) (41,400) (41,400)
----------- -----------
Total stockholders' equity 27,595 30,517
----------- -----------
$ 160,540 $ 162,712
=========== ===========
</TABLE>
See accompanying notes to financial statements.
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BLACK GIANT OIL COMPANY
STATEMENTS OF OPERATIONS
QUARTERS ENDED JUNE 30, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
------------ ------------
<S> <C> <C>
Revenues:
Miscellaneous income $ 130 $ --
------------ ------------
Total revenues 130 0
------------ ------------
Operating expenses:
General and administrative 1,467 8,633
------------ ------------
1,467 8,633
------------ ------------
Loss from operations (1,337) (8,633)
Other income (expense):
Interest expense (3,400) (3,400)
------------ ------------
Loss from continuing operations (4,737) (12,033)
Discontinued operations 1,815 5,194
------------ ------------
Net loss $ (2,922) $ (6,839)
============ ============
Loss per common share:
From continuing operations $ (0.00) $ (0.00)
============ ============
Net loss $ (0.00) $ (0.00)
============ ============
Weighted average common shares outstanding 24,423,477 14,350,227
============ ============
</TABLE>
See accompanying notes to financial statements.
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BLACK GIANT OIL COMPANY
STATEMENTS OF CASH FLOWS
QUARTERS ENDED JUNE 30, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
------- -------
<S> <C> <C>
Cash flows from operating activities:
Net loss $(2,922) $(6,839)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Changes in operating assets and liabilities:
Prepaid expenses 2,500 --
Accounts payable and accrued liabilities 900 2,824
------- -------
Net cash provided by (used in) operating activities 478 (4,015)
------- -------
Cash flows from financing activities:
Advances from officer (150) 5,000
------- -------
Net increase (decrease) in cash and cash equivalents 328 985
Cash at beginning of year 119 179
------- -------
Cash at end of year $ 447 $ 1,164
======= =======
Supplemental disclosure:
Total interest paid $ -- $ 3,000
======= =======
</TABLE>
See accompanying notes to financial statements.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
CAUTION RESPECTING FORWARD-LOOKING INFORMATION
This Form 10-QSB includes "forward-looking" statements within the meaning of
Section 27A of the Securities Act and the Company desires to take advantage of
the "safe harbor" provisions thereof. Therefore, the Company is including this
statement for the express purpose of availing itself of the protections of such
safe harbor provisions with respect to all of such 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
and oral forward-looking statements attributable to the Company or persons
acting on its behalf are expressly qualified in their entirety by this section.
OVERVIEW
This discussion should be read in conjunction with Management's Discussion and
Analysis of Financial Conditions and Results of Operations in Black Giant's
annual report on Form 10-KSB for the year ended March 31, 1999.
Oil prices continued to decline during the first quarter of the fiscal year so
management shifted its focus to securing a merger/acquisition candidate.
Management reviewed and investigated merger candidate possibilities. As of June
30, 1999 no agreements or contracts were formalized or executed.
BLACK GIANT OIL COMPANY IS SUFFERING FROM SHORTAGES OF WORKING CAPITAL,
INDEBTEDNESS AND DUE OR PAST DUE CURRENT LIABILITIES. THE COMPANY IS IN NEED OF
ADDITIONAL INVESTMENT CAPITAL, STRATEGIC ALLIANCES, OR A SALE, OR
MERGER/ACQUISITION.
LIQUIDITY AND CAPITAL RESOURCES
As discussed in the Overview above and as outlined in the Form 10-KSB for fiscal
year March 31, 1999 including its financial statements, the Company's operating
losses and its working capital deficit raise doubt about its ability to continue
as a going concern.
During the year ended March 31, 1998, the Company began acquiring oil and gas
properties with the intention of developing the properties and becoming an oil
and gas producer. However, with the drop in oil prices during the period, the
Company has decided to discontinue those operations. Accordingly, the oil and
gas operations are reported as discontinued in the accompanying statement of
operations and the net oil and gas assets are reported in the accompanying
balance sheet as net assets of discontinued operations. The Company's assets as
of March 31, 1999 were $162,712, and its liabilities were $132,195. On June 30,
1999 the Company's assets were $160,540 and its liabilities were $132,945.
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RESULTS OF OPERATIONS
The Company has suffered continuing net losses from operations. As explained
above, without a merger partner, the Company has nominal operations. The Company
is dependant on a merger partner or raising additional funds in order to provide
capital for the Company to continue as a going concern. The Company has had
nominal revenues from oil and gas activities for the three months ended June 30,
1999 and 1998 $1,815 and $6,135 respectively. These oil and gas operations are
reported as discontinued in the accompanying statement of operations and the net
oil and gas assets are reported in the accompanying balance sheet as net assets
of discontinued operations
Operating expenses were also nominal during the two periods ending June 30, 1999
and 1998. The current period only had expenditures of $1,467 and the same period
of 1998 had expenditures of $8,633 due to auditing, legal and proxy mailing
expenses.
IMPACT OF THE YEAR 2000 ISSUE
The year 2000 poses certain issues for business and consumer computing,
particularly the functionality of software for two-digit storage of dates and
special meanings for certain dates such as 9/9/99. The year 2000 is also a leap
year, which may lead to incorrect calculations, functions or system failure. The
widespread use of computer programs that rely on these two-digit date programs
to perform computations and decision-making functions may cause information
technology systems to malfunction in and around the year 2000. Such malfunctions
may lead to significant business delays in the U.S. and internationally. The
problem exists for many kinds of software, including software for mainframes,
PCs and embedded systems. Many normal business activities will potentially be
impacted because information necessary to monitor and control various operations
is controlled by computers.
The Company has studied and tested its technologies systems impacted by the Year
2000 transition. The Company believes that its systems are Year 2000 compliant.
However, variability of hardware and software combinations may lead to
unforeseen problems. The Company does not believe that any problems that arise
with internal systems will be material or will require more than minimal costs
to overcome.
The Company's vendors are various and diverse and the bulk of the items
purchased by the Company are widely available. There are no problems which are
expected to arise due to vendors' failure to be Year 2000 compliant because
auxiliary channels should be available to the Company to acquire its supplies,
parts and other needs from other vendors should any particular vendor have a
problem due to noncompliance.
Due to the nature of the Company's business and its information and accounting
systems, costs to bring its systems into compliance have been immaterial.
PART II. - OTHER INFORMATION
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit No. Exhibit
- ----------- -------
27 Financial Data Schedule
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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.
BLACK GIANT OIL COMPANY
(Registrant)
Date: August 30, 1999 /s/ Ivan Webb
-------------------------------------
By: Ivan Webb, President, Chief
Executive Officer, Principal Accounting
Officer, Principal Financial Officer
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Index to Exhibits
<TABLE>
<CAPTION>
Exhibit No. Exhibit
- ----------- -------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-START> APR-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 447
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,947
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 160,540
<CURRENT-LIABILITIES> 32,935
<BONDS> 100,010
0
0
<COMMON> 305,293
<OTHER-SE> (277,698)
<TOTAL-LIABILITY-AND-EQUITY> 160,540
<SALES> 130
<TOTAL-REVENUES> 130
<CGS> 0
<TOTAL-COSTS> 1,467
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,400
<INCOME-PRETAX> (4,737)
<INCOME-TAX> 0
<INCOME-CONTINUING> (4,737)
<DISCONTINUED> 1,215
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,922)
<EPS-BASIC> (.00)
<EPS-DILUTED> (.00)
</TABLE>
