SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10Q
QUARTERLY REPORT PURSUANT OF SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended - December 31, 1998
0-9295
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Commission File Number
WINCO PETROLEUM CORPORATION
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(Exact name of registrant as specified in its charter)
COLORADO 84-0794604
- ------------------------------- ---------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation of organization)
P O BOX 342
GARDEN CITY, KANSAS 67846
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(Address of principle executive offices) (Zip Code)
(316) 275-2963
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(Registrant's telephone number. Including area code)
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(Former name, former address, former fiscal year if changed since
last report)
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 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 _____ No
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASS OF
COMMON STOCK, AS OF THE CLOSE OF THE PERIOD COVERED BY THIS REPORT.
Class: Common Stock, No par value
Outstanding as of December 31, 1998: 40,852,576
<PAGE>
WINCO PETROLEUM CORPORATION
CONDENSED BALANCE SHEET
<TABLE>
<CAPTION>
December 31, 1998 September 30, 1998
(Unaudited) (Audited)
----------------- ------------------
ASSETS
- ------
<S> <C> <C>
CURRENT ASSETS:
Cash and short-term investment $ 325,096 $ 328,202
Notes and accounts receivable 38,298 38,298
Prepaid expenses and other - -
----------- -----------
TOTAL CURRENT ASSETS 363,394 366,500
INVESTMENTS IN OIL AND GAS PROPERTIES
At Cost, Net (Using the full cost method of
of accounting) 168,293 172,800
FURNITURE, FIXTURES AND VEHICLES, At Cost,
Net of Allowances for Depreciation 361 361
OTHER ASSETS 1,000 1,000
----------- -----------
TOTAL ASSETS $ 533,048 $ 540,661
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LIABILITIES AND STOCKHOLDERS' INVESTMENT
- ----------------------------------------
CURRENT LIABILITIES:
Accounts payable to stockholders
and directors $ 150 $ 150
Accounts payable and accrued
liabilities 20,858 20,858
----------- -----------
TOTAL CURRENT LIABILITIES 21,008 21,008
----------- -----------
STOCKHOLDERS' INVESTMENT
Common stock, no par value;
50,000,000 shares authorized;
23,000,000 shares issued and outstanding 307,000 307,000
Additional paid in capital 1,288,500 1,288,500
Accumulated deficit (1,052,043) (1,044,555)
Treasury stock ( 31,437) ( 31,312)
----------- -----------
TOTAL STOCKHOLDERS' INVESTMENT 512,040 519,653
----------- -----------
TOTAL LIABILITIES AND
STOCKHOLDERS' INVESTMENT $ 533,048 $ 540,661
=========== ===========
</TABLE>
<PAGE>
WINCO PETROLEUM CORPORATION
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
DECEMBER 31,
1998 1997
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REVENUES:
<S> <C> <C>
Oil and gas sales $ 224 $ 32,188
Interest income 1,808 1,366
----------- -----------
2,032 33,554
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EXPENSES:
Lease operating expenses 32 21,991
General and administrative 4,981 5,220
Depreciation, depletion and
Amortization 4,507 7,000
----------- -----------
9,420 34,211
----------- -----------
Income (Loss) before income tax ( 7,488) ( 657)
Income tax expense (benefit) - -
----------- -----------
NET INCOME (LOSS) $( 7,488) $( 657)
=========== ===========
NET INCOME (LOSS) PER COMMON
SHARE - Primary and fully diluted $ - $ -
=========== ===========
WEIGHTED AVERAGE SHARES OUTSTANDING 40,852,576 40,852,576
=========== ===========
</TABLE>
<PAGE>
WINCO PETROLEUM CORPORATION
STATEMENT OF CASH FLOW
<TABLE>
<CAPTION>
THREE MONTHS ENDING DECEMBER 31,
1998 1997
----------- ------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $( 7,488) $( 657)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation, depletion and
amortization 4,507 7,000
Changes in current assets and
current liabilities:
Accounts Receivable - ( 30,945)
Accounts Payable - 1,996
----------- -----------
Net cash provided (used) in
operating activities ( 2,981) ( 22,606)
Cash flows from (used in) investing activities:
Investment in oil and gas properties - -
Purchase of common stock for Treasury ( 125) -
----------- -----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS ( 3,106) ( 22,606)
Cash and Cash Equivalents at beginning of period 328,202 166,605
----------- -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 325,096 $ 143,999
=========== ===========
</TABLE>
<PAGE>
WINCO PETROLEUM CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
CONDENSED FINANCIAL STATEMENTS
- ------------------------------
1. The accompanying, unaudited financial statements have been prepared in
accordance with Rule 10-01 of Regulation S-X and do not include all
principles for completed financial statements.
In the opinion of Winco Petroleum Corporation the accompanying, unaudited,
condensed financial statements contain all adjustments (consisting of
normal adjustments) necessary to present fairly the financial position as
of December 31, 1998 and the results of operations and changes in financial
position for the three months then ended. Operating results for the three
months ended December 31, 1998 are not necessarily indicative of the
results that may be expected for the fiscal year ending September 30, 1999.
These statements should be read in conjunction with the financial
statements and notes thereto included in Form 10-K for the fiscal year
ended September 30, 1998.
INVESTMENTS IN OIL AND GAS PROPERTIES
- -------------------------------------
2. Depreciation and depletion of the full cost pool is computed using a
unit-of-production method based on proved reserves as determined by the
Company and independent engineers. A provision of $4,507 was made for the
three months ended December 31, 1998. Reserve for depreciation and
depletion was $93,887 and $89,380 on December 31, 1998 and September 30,
1998, respectively.
EARNINGS PER SHARE
- ------------------
3. Earnings per common share were computed by dividing net income by the
weighted average number of shares of common stock outstanding during the
three month period ended December 31, 1998 and 1997. The weighted average
number shares outstanding for the periods ending December 31, 1998 and 1997
was 40,852,576.
<PAGE>
WINCO PETROLEUM CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
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During the three months ended December 31, 1998, the Company's working
capital decreased $3,106. Working capital decreased as a result of the
Company's normal operations. The Company's working capital at December 31,
1998 was $342,386.
The Company intends to utilize funds to purchase producing properties. The
Company also may participate in oil and gas development programs through
sharing arrangements with industry participants. The Company will consider
those arrangements which are financially feasible under current conditions.
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 1998
- ------------------------------------------------------------------
During the three months ended December 31, 1998 oil and gas sales decreased
approximately $31,964 from the comparable period in 1997. Due to low oil
prices the Company decided to restrict production and sales until prices
improve. There was a corresponding decrease in lease operating expenses of
$21,959 between the same periods.
Interest income increased from the comparable period in 1997 due to more
cash available for investment.
Due to net operating loss carry forward and tax credits available for
financial and tax reporting purposes, the Company does not expect any
significant income tax effects in the current year.
General and administrative expense decreased slightly from the comparable
quarter in 1997, primarily as a result of restricted oil and gas operations.
<PAGE>
WINCO PETROLEUM CORPORATION
PART II
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ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
WINCO PETROLEUM CORPORATION
/s/ CECIL O'BRATE
----------------------------------------------
Cecil O'Brate, President
Dated: December 30, 1999
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> DEC-31-1998
<CASH> 325,096
<SECURITIES> 0
<RECEIVABLES> 38,298
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 363,394
<PP&E> 262,180
<DEPRECIATION> 93,887
<TOTAL-ASSETS> 533,048
<CURRENT-LIABILITIES> 21,008
<BONDS> 0
0
0
<COMMON> 307,000
<OTHER-SE> 205,040
<TOTAL-LIABILITY-AND-EQUITY> 533,048
<SALES> 224
<TOTAL-REVENUES> 2,032
<CGS> 0
<TOTAL-COSTS> 9,420
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (7,488)
<INCOME-TAX> 0
<INCOME-CONTINUING> (7,488)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,488)
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
