<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended September 30, 1996 Commission File Number 0-9394
BLACK DOME ENERGY CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Colorado 84-0808397
------------------------------ ---------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1536 Cole Blvd., Ste #325
Golden, Colorado 80401
------------------------------ ---------------------
(Address of principal executive (Zip code)
offices)
Registrant's telephone number, including area code: (303)231-9059
------------------
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
------- -------
At September 30, 1996, 73,755 shares of no par value common stock (the
registrant's only class of voting stock) were outstanding.
Page 1
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BLACK DOME ENERGY CORPORATION
-----------------------------
INDEX TO FORM 10-Q
------------------
SEPTEMBER 30, 1996
------------------
PART I - FINANCIAL INFORMATION PAGE
----
Item 1. Financial Statements .
-------------------------------
Condensed balance sheet 3
at September 30, 1996 and
December 31, 1995.
Statement of operations for 5
for the nine-month periods ended
September 30, 1996 and 1995 and
the three-month periods ended
September 30, 1996 and 1995.
Statement of cash flows 6
for the nine-month periods ended
September 30, 1996 and 1995 and
the three-month periods ended
September 30, 1996 and 1995.
Notes to Financial Statements 7
Item 2. Management's Discussion and 8
Analysis of Financial Conditions and
Results of Operations.
PART II - OTHER INFORMATION 9
------------------------------
The financial information furnished in this Form 10-Q reflects all
adjustments which are, in the opinion of management, necessary for a fair
presentation of the financial position of the Company and results of its
operations for the interim periods presented.
Page 2
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PART I- FINANCIAL INFORMATION
- -----------------------------
Item 1. Financial Statements
BLACK DOME ENERGY CORPORATION
-----------------------------
CONDENSED BALANCE SHEET
-----------------------
September 30, December 31,
1996 1995
------------- -------------
(Unaudited) (Note)
ASSETS
Current Assets:
<TABLE>
<CAPTION>
<S> <C> <C>
Cash $ 230,211 $ 63,008
Accounts Receivable 72,615 80,130
Total current assets $ 302,826 $ 143,138
Property and equipment, at cost:
Oil and gas properties - net
(successful efforts method) 120,095 220,994
Materials and supplies 29,017 44,926
Other property and equipment
- net -- 1,988
-------- ------
Total assets $ 451,938 $ 411,046
========== ==========
</TABLE>
Note: The balance sheet at December 31, 1995 has been taken from the audited
of financial statements at that date, and condensed.
Page 3
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BLACK DOME ENERGY CORPORATION
-----------------------------
BALANCE SHEET (CONT'D)
----------------------
September 30, December 31,
1996 1995
-------------- -------------
(Unaudited) (Note)
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
<TABLE>
<CAPTION>
<S> <C> <C>
Accounts Payable $ 113,634 $ 79,243
Note Payable - Bank 33,758 84,987
Other Payables 9,600 9,600
Deferred Compensation 222,500 160,000
-------- --------
Total Current Liabilities 379,492 333,830
-------- --------
Stockholders' Equity:
Common stock; no par value;
authorized 10,000,000 shares,
issued and outstanding 73,755
2,170,353 2,170,353
Accumulated deficit (2,097,907) (2,093,137)
--------- ---------
Total stockholders' equity 72,446 77,216
Total liabilities and
stockholders' equity $ 451,938 $ 411,046
========== ==========
</TABLE>
Note: The balance sheet at December 31, 1995 has been taken from the audited
financial statements at that date, and condensed.
Page 4
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BLACK DOME ENERGY CORPORATION
-----------------------------
STATEMENT OF OPERATIONS
-----------------------
Nine Months Three Months
Ended Ended
September 30, September 30,
------------------- -------------------
1996 1995 1996 1995
-------- -------- -------- ---------
(Unaudited)
Revenue:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Oil and gas sales $441,954 $328,573 $145,728 $105,396
Operating income 8,517 8,517 2,839 2,839
Interest Income 236 357 78 159
Miscellaneous -- 290 -- 42
------- ------- ------- -------
Total $450,707 $337,737 $148,645 $108,436
------- ------- ------- -------
Expenses:
Oil & Gas production 135,490 141,944 31,081 45,218
Production and windfall
profit taxes 24,690 19,465 8,050 6,030
Depreciation, depletion
and amortization 120,000 58,172 36,500 25,172
General & Administrative 175,297 177,401 50,632 42,136
------- ------- ------ ------
Total Expenses $455,477 $396,982 $126,263 $118,556
------- ------- ------- -------
Net Income (loss) $< 4,770> $<59,245> $ 22,382 $<10,120>
========= ========= ======== =========
Income per common and
common equivalent share $ < .06> $ < .80> $ .31 $ <.13>
========= ========= ======== =========
</TABLE>
Page 5
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BLACK DOME ENERGY CORPORATION
-----------------------------
STATEMENT OF CASH FLOWS
-----------------------
Nine Months Three Months
Ended Ended
September 30, September 30,
---------------- ----------------
1996 1995 1996 1995
------ ------ ------ ------
(Unaudited) (Unaudited)
Cash flows from operating activities:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Net earnings (loss) $< 4,770> $< 59,245> $ 22,382 $<10,120>
Depreciation, depletion,
amortization 120,000 58,172 36,500 25,172
Changes in assets and
liabilities:
(Increase) decrease in
receivables 7,515 2,480 9,311 < 1,954>
Increase (decrease) in
accounts payable 34,391 15,501 34,359 <14,552>
Increase (decrease) in
other liabilities -- 2,294 -- --
Increase (decrease) in
deferred comp. 62,500 44,600 -- 25,000
------- ------ ------- -------
Net cash provided
(used) by 219,636 63,802 $102,552 $ 23,546
operating activities ------- ------ ------- -------
Cash flows from investing
activities:
Purchase of equipment < 17,113> < 17,832> < 4,499> <14,293>
Purchase of well
equipment inventory,
net of transfers to
wells 15,909 < 10,696> 16,935 5,164
------- ------- ------ -----
Net cash (used in)
provided by
investing activities < 1,204> < 28,528> 12,436 < 9,129>
------- ------- ------ ------
Cash flows from financing
activities:
Increase (decrease) in
line-of-credit -- < 41,215> -- --
Increase (Decrease) in
notes payable <51,229> < 14,467> < 19,539> <14,467>
------ ------ ------ ------
Net cash (used in)
provided by
financing activities <51,229> < 55,682> < 19,539> <14,467>
------ ------ ------ ------
Increase (decrease) in
cash 167,203 < 20,408> 95,449 < 50>
Cash balance at beginning
of period 63,008 53,429 134,762 33,071
Cash balance at end
of period $ 230,211 $ 33,021 $230,211 $ 33,021
========= ========= ======== ========
</TABLE>
The Company changed its line of credit in 1995 to a term note payable in the
amount of $91,509.
Page 6
Notes to Financial Statements of
--------------------------------
Black Dome Energy Corporation
-----------------------------
SEPTEMBER 30, 1996
(UNAUDITED)
NOTE 1 -- Basis of Preparation and Presentation
-------------------------------------
The Black Dome Energy Corporation financial statements included herein have
been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission and include all
adjustments which are, in the opinion of management, necessary for a fair
presentation. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules
and regulations. The Company believes that the disclosures are adequate to
make the information presented not misleading; however, it is suggested
that these financial statements be read in conjunction with the financial
statements and the notes thereto which are incorporated by reference in the
Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1995. The financial data for the interim periods may not necessarily be
indicative of results to be expected for the year.
Page 7
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Item 2. Management's Discussion and Analysis of Financial
--------------------------------------------------
Condition and Results of Operations.
------------------------------------
General
-------
This discussion and analysis covers variations in the balance sheets December
31, 1995, and September 30, 1996, and in the statements of operations and
changes in cash flows for the nine-month periods ended September 30, 1996
and 1995.
The Company is currently preparing a proxy for a meeting of its shareholders.
Due to declining reserves and the difficulty of replacing the reserves, the
Company's liquidity on an ongoing basis is becoming difficult to maintain and
the Company will present to its shareholders a motion to consider possible
liquidation.
Liquidity and Capital Resources
-------------------------------
Working capital (which incorporates current and deferred obligations)
increased slightly by $2,137 during the year ended December 31, 1995. This
followed a working capital increase of $84,031 in 1994. Working capital at
September 30, 1996 was $<76,666>. Cash increased by $167,203 from December
31,1995 to September 30, 1996, primarily due to better prices on existing oil
and gas properties.
The current ratio deficit was reduced from $190,692 to $76,666, an
improvement in liquidity of $114,026 during the nine months ended September
30, 1996.
Results of Operations
---------------------
During the nine months ended September 30, 1996, the Company experienced an
increase in the price it received from oil and gas sales. The increase in
oil and gas sales for the nine months ended September 30, 1996, compared to
September 30, 1995, was $113,381, while production costs during the same
period decreased by $6,454. Production costs for the nine month period ended
September 30, 1995 were $141,944 (43% of revenue) as compared to $135,490
(31% of revenue) for nine months ended September 30, 1996. Depreciation and
depletion during the comparable period increased $61,828 as a result of
increased production, with a corresponding increase in production taxes.
General and Administrative expenses were lower by $2,104 for the September
30, 1996 period as compared to September 30, 1995. General and Administrative
expenses for the nine month period ended September 30, 1995 were $177,401
compared to $175,297 for the same period ended September 30, 1996.
Restructuring of the Company's operations and tighter control on costs
resulted in decreases of $6,454 in production costs and $2,104 in general and
administrative costs during the nine month period ended September 30, 1996.
Interest income has decreased in the past few years both because of smaller
amounts of invested cash and lower interest rates.
Page 8
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PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits: None
(b) Reports: None
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on behalf of the
undersigned thereunto duly authorized.
BLACK DOME ENERGY CORPORATION
-----------------------------
Date: November 11, 1996 by: /s/ Edgar J. Huff
------------------- -----------------------
Edgar J. Huff, President
and Chief Financial
Officer
Page 9
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 230,211
<SECURITIES> 0
<RECEIVABLES> 72,615
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 302,826
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 451,938
<CURRENT-LIABILITIES> 379,492
<BONDS> 0
0
0
<COMMON> 73,755
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 451,938
<SALES> 145,728
<TOTAL-REVENUES> 148,645
<CGS> 0
<TOTAL-COSTS> 126,263
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 22,382
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 22,382
<EPS-PRIMARY> .31
<EPS-DILUTED> .31
</TABLE>
