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 - MARCH 31, 2000
0-9295
------------------------
Commission File Number
WINCO PETROLEUM CORPORATION
------------------------------------------------------
(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 34
GARDEN CITY, KANSAS 67846
--------------------------------------- -----------
(Address of principle executive offices (Zip Code)
(316) 275-2963
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(Registrant's telephone number. Including area code)
-----------------------------------------------------------
(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 MARCH 31, 2000: 41,152,606
<PAGE>
WINCO PETROLEUM CORPORATION
CONDENSED BALANCE SHEET
<TABLE>
<CAPTION>
March 31, 2000 September 30, 1999
(Unaudited) (Audited)
-------------- ------------------
ASSETS
- ------
<S> <C> <C>
CURRENT ASSETS:
Cash and short-term investment $ 318,599 $ 273,172
Notes and accounts receivable - trade 29,529 28,127
Notes and accounts receivable - related party 22,905 48,970
---------- ----------
TOTAL CURRENT ASSETS 371,033 350,269
INVESTMENTS IN OIL AND GAS PROPERTIES
At Cost, Net (Using the full cost method of
of accounting) 207,946 220,989
FURNITURE, FIXTURES AND VEHICLES, At Cost,
Net of Allowances for Depreciation - -
OTHER ASSETS 1,000 1,000
---------- ----------
TOTAL ASSETS $ 579,979 $ 572,258
========== ==========
LIABILITIES AND STOCKHOLDERS' INVESTMENT
- ----------------------------------------
CURRENT LIABILITIES:
Accounts payable to stockholders,
Directors, and related parties $ 150 $ 35,447
Accounts payable and accrued
liabilities 15,054 2,334
---------- ----------
TOTAL CURRENT LIABLITIES 15,204 37,781
---------- ----------
STOCKHOLDERS' INVESTMENT
Common stock, no par value;
500,000,000 shares authorized;
41,152,606 shares issued and outstanding 307,000 307,000
Additional paid in capital 1,292,920 1,292,920
Accumulated deficit (1,002,858) (1,033,156)
Treasury stock ( 32,287) ( 32,287)
---------- ----------
TOTAL STOCKHOLDERS' INVESTMENT 564,775 534,477
---------- ----------
TOTAL LIABILITIES AND
STOCKHOLDERS' INVESTMENT $ 579,979 $ 572,258
========== ==========
</TABLE>
<PAGE>
WINCO PETROLEUM CORPORATION
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
2000 1999
-------------- --------------
<S> <C> <C>
REVENUES:
Oil and gas sales $ 117,969 $ 9,361
Interest income - 2,455
Gain on sale of assets - -
---------- ----------
117,969 11,816
---------- ----------
EXPENSES:
Lease operating expenses 59,581 8,327
General and administrative 19,492 1,186
Depreciation, depletion and
Amortization 6,522 4,507
---------- ----------
85,595 14,020
---------- ----------
Income (Loss) before income tax 32,374 ( 2,204)
Income tax expense (benefit) - -
---------- ----------
NET INCOME (LOSS) $ 32,374 $( 2,204)
========== ==========
NET INCOME (LOSS) PER COMMON
SHARE - Primary and fully diluted $ - $ -
========== ==========
WEIGHTED AVERAGE SHARES OUTSTANDING 41,152,606 41,152,606
========== ==========
</TABLE>
<PAGE>
WINCO PETROLEUM CORPORATION
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended
March 31,
2000 1999
-------------- --------------
<S> <C> <C>
REVENUES:
Oil and gas sales $ 164,843 $ 9,585
Interest income - 4,263
Gain on sale of assets - -
---------- ----------
164,843 13,848
---------- ----------
EXPENSES:
Lease operating expenses 95,949 8,357
General and administrative 25,553 6,119
Depreciation, depletion and
Amortization 13,044 9,015
---------- ----------
134,546 23,491
---------- ----------
Income (Loss) before income tax 30,297 ( 9,643)
Income tax expense (benefit) - -
---------- ----------
NET INCOME (LOSS) $ 30,297 $( 9,643)
========== ==========
NET INCOME (LOSS) PER COMMON
SHARE - Primary and fully diluted $ - $ -
========== ==========
WEIGHTED AVERAGE SHARES OUTSTANDING 41,152,606 41,152,606
========== ==========
</TABLE>
<PAGE>
WINCO PETROLEUM CORPORATION
STATEMENT OF CASH FLOW
<TABLE>
<CAPTION>
Six Months Ended March 31,
2000 1999
-------------- --------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 30,297 $ ( 9,643)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation, depletion and
amortization 13,044 9,015
Gain on sale of assets
Changes in current assets and
current liabilities:
Accounts Receivable 24,663 -
Accounts Payable ( 22,577) -
---------- ----------
Net cash provided (used) in
operating activities 45,427 ( 678)
Cash flows from (used in) investing activities:
Investment in oil and gas properties - -
Purchase of common stock for Treasury ( 125)
Proceeds from sale of oil & gas property - -
---------- ----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 45,427 ( 803)
Cash and Cash Equivalents at beginning of period 273,172 328,202
---------- ----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 318,599 $ 327,199
========== ==========
</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 March 31, 2000 and the results of operations for the three and six
months then ended and changes in cash flow for the six months then ended.
Operating results for the three and six months ended March 31, 2000 are not
necessarily indicative of the results that may be expected for the fiscal
year ending September 30, 2000. 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, 1999.
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. Provisions of $6,522 and $11,044 were
made for the three and six months ended March 31, 2000. Reserve for
depreciation and depletion was $128,513 and $115,469 on March 31, 2000 and
September 30, 1999, 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 and six month periods ended March 31, 2000 and 1999. The weighted
average number shares outstanding for the periods ending March 31, 2000 and
1999 was 41,152,606.
RELATED PARTY TRANSACTIONS
- --------------------------
2. Oil and gas properties owned by the Company are operated by entities
considered related parties due to ownership and management by directors and
officers of the Company. Operation by such parties are on the same basis
as outside third party operators. As a result of such operations, proceeds
from revenues are usually in process of distribution resulting in amounts
considered receivable. Similarly, charges for costs of operation of the
Company's properties are usually in process of billing and payment
resulting in amounts considered payable.
<PAGE>
WINCO PETROLEUM CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
During the three and six months ended March 31, 2000, the Company's working
capital increased $38,896 and $43,341, respectively. Working capital
increased as a result of the Company's normal operations. The Company's
working capital at March 31, 2000 was $355,829.
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 MARCH 31, 2000
- ---------------------------------------------------------------
During the three months ended March 31, 2000, oil and gas sales increased
approximately $108,608 from the comparable period in 1999. The increase in
sales resulted from the additional production from properties purchased in
the prior year and improved oil prices. There was a corresponding increase
in lease operating expenses of $51,254 between the same periods.
General and administrative expense increased from the comparable quarter in
1999, by $18,306, for audit and legal costs associated with the Company's
reporting requirements.
Interest income decreased from the comparable period in 1999 due to
movement of cash balances to a non-interest-bearing account for purposes of
anticipated purchases.
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.
<PAGE>
WINCO PETROLEUM CORPORATION
PART II
- -------
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: May 15, 2000
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-2000
<PERIOD-START> OCT-01-1999
<PERIOD-END> MAR-31-2000
<CASH> 318,599
<SECURITIES> 0
<RECEIVABLES> 52,434
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 371,033
<PP&E> 336,459
<DEPRECIATION> 128,573
<TOTAL-ASSETS> 579,979
<CURRENT-LIABILITIES> 15,204
<BONDS> 0
0
0
<COMMON> 307,000
<OTHER-SE> 257,775
<TOTAL-LIABILITY-AND-EQUITY> 579,979
<SALES> 117,969
<TOTAL-REVENUES> 117,969
<CGS> 0
<TOTAL-COSTS> 85,595
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 32,374
<INCOME-TAX> 0
<INCOME-CONTINUING> 32,374
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 32,374
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
