SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
____
--------------------------
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES ACT OF 1934
For the quarterly period ended March 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number 0-30472
PIONEER OIL AND GAS
Incorporated pursuant to the Laws of the State of Utah
Internal Revenue Service - Employer Identification No. 87-0365907
1206 W. South Jordan Parkway, Unit B
South Jordan, Utah 84095-4551
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.
Yes ____ No _X_
---
The total number of shares of the registrant's Common Stock, $.001 par value,
outstanding on March 31, 2000, was 8,135,018.
<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements for Second Fiscal Quarter 2000
Period Ending March 31, 2000
<PAGE>
<TABLE>
<CAPTION>
Financial Statements for Second Fiscal Quarter 2000
Period Ending March 31, 2000
PIONEER OIL AND GAS
Balance Sheet
March 31, Sept. 30,
As of 2000 1999
- ---------------------------------------------------------------------------------------------------------
(Unaudited)
Assets
Current assets:
<S> <C> <C>
Cash $ 130,042 $ 343,919
Accounts receivable 94,867 105,798
Resale leases, at lower of cost or market 161,956 17,333
----------- -----------
Total current assets 386,865 467,050
Property and equipment - net (successful efforts method) 679,962 586,005
Other assets 3,230 3,000
----------- -----------
$ 1,070,057 $ 1,056,055
------------ ------------
- ---------------------------------------------------------------------------------------------------------
Liabilities and Stockholders' Equity (Deficit)
Current liabilities:
Cash overdraft $ - $ -
Accounts payable 53,301 109,099
Accrued expenses 21,916 22,426
Note payable 130,000 -
----------- -----------
Total current liabilities 205,217 131,525
----------- ----------
Commitments and contingencies - -
Stockholders' equity (deficit):
Common stock, par value $.001 per share, authorized
50,000,000 shares: 8,135,018 shares and 5,644,792
shares issued and outstanding, respectively 8,134 8,134
Additional paid-in capital 2,521,069 2,521,069
Stock subscription receivable (293,460) (293,460)
Accumulated deficit (1,311,213) (1,311,213)
Year to date income (loss) (59,690) -
Total stockholder's equity (deficit) 864,840 924,530
----------- -----------
$ 1,070,057 $ 1,056,055
----------- -----------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PIONEER OIL AND GAS
Statement of Income
Second Quarter Ending March 31, 2000
(unaudited)
2000 1999
-------- --------
Revenue:
<S> <C> <C>
Oil and gas sales $ 230,623 $ 122,168
Royalty Revenue 9,421 23,030
Operational reimbursements 1,745 645
Project and lease sales income - 18,059
-------- --------
241,789 163,902
Costs and expenses:
Cost of operations 47,075 75,617
General and administrative expenses 110,277 75,514
Exploration costs 46,129 41,041
Lease rentals - 449
Depreciation, depletion and amortization 31,590 37,868
-------- --------
235,071 230,489
-------- --------
Loss from operations 6,718 (66,587)
-------- --------
Other income (expense):
Gain (loss) on assets sold or abandoned 52 22,694
Gain on marketable securities - -
Interest expense (2,218) (44,799)
Other (expense) income 1,916 14
-------- --------
Income (loss before provision
for income taxes) 6,468 (88,678)
-------- --------
Provision for income taxes - -
-------- --------
Net income (loss) $ 6,468 $ (88,678)
-------- --------
Earnings per share - basic and diluted $ .00 $ (.01)
-------- --------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PIONEER OIL AND GAS
Statement of Income
For Six-Months Ending March 31,
(unaudited)
2000 1999
---- ----
Revenue:
<S> <C> <C>
Oil and gas sales $ 411,648 $ 258,774
Royalty Revenue 44,761 53,130
Operational reimbursements 2,245 9,396
Project and lease sales income - 33,163
-------- --------
458,654 354,463
Costs and expenses:
Cost of operations 142,506 150,855
General and administrative expenses 220,460 145,392
Exploration costs 92,757 105,637
Lease rentals 1,825 1,908
Depreciation, depletion and amortization 63,180 75,736
-------- --------
520,728 479,528
-------- --------
Loss from operations (62,074) (125,065)
-------- --------
Other income (expense):
Gain (loss) on assets sold or abandoned 52 22,694
Gain on marketable securities - -
Interest expense (2,223) (65,935)
Other (expense) income 4,555 456
-------- --------
Income (loss before provision
for income taxes) (59,690) (167,850)
-------- --------
Provision for income taxes - -
-------- --------
Net income (loss) $ (59,690) $ (167,850)
-------- --------
Earnings per share - basic and diluted $ (.01) $ (.02)
-------- --------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PIONEER OIL AND GAS
Statement of Cash Flows
First The Six-Months Ending March 31,
(unaudited)
2000 1999
--------- ---------
Cash flows from operating activities:
<S> <C> <C>
Net income $ (59,690) $ (167,850)
Adjustments to reconcile net income to net cash
(used in) provided by operating activities:
Gain on assets sold or abandoned - -
Depreciation, depletion and amortization 63,180 75,736
Gain on forgiveness of debt - -
Realized loss on marketable securities - -
Stock issued to employee stock ownership plan - -
(increase) decrease in:
Accounts receivable 10,930 (11,780)
Resale leases (144,623) (3,558)
Property and Equipment (157,136) 64,145
Other assets (230) 53
Increase (decrease) in:
Outstanding checks in excess of bank balance - (78,854)
Accounts payable (55,798) (81,102)
Accrued expenses (510) (257,885)
--------- ---------
Net cash (used in) provided by
operating activities (343,877) (461,095)
--------- ---------
Cash flows from investing activities:
Proceeds from sale of property - -
Acquisition of property and equipment - -
--------- ---------
Net cash provided by investing activities - -
--------- ---------
Cash flow from financing activities:
Proceeds from note payable 130,000 124,579
Payments on note payable - -
Proceeds from issuance of common stock - 403,776
Collection of stock subscription receivable - -
Stock subscription receivable - (300,000)
--------- ---------
Net cash (used in) provided by
financing activities - 228,355
--------- ---------
Net increase (decrease) in cash (213,877) (232,740)
Cash, beginning of period $ 343,919 $ 255,148
--------- ---------
Cash, end of period $ 130,042 $ 22, 048
--------- ---------
</TABLE>
<PAGE>
PIONEER OIL AND GAS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
First Fiscal Quarter Ending December 31, 1999
(Unaudited)
NOTE 1 - UNAUDITED INTERIM INFORMATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Regulation
S-B. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the three-month and six-month periods ending
March 31, 2000 are not necessarily indicative of the results that may be
expected for the year ending September 30, 2000. For further information, refer
to the financial statements and footnotes thereto included in the Company's Form
10-SB for the year ended September 30, 1999.
(1) The unaudited financial statements include the accounts of Pioneer Oil
and Gas and include all adjustments (consisting of normal recurring
items) which are, in the opinion of management, necessary to present
fairly the financial position as of March 31, 2000 and the results of
operations and cash flows for the three-month and six-month periods ended
March 31, 2000 and 1999. The results of operations for the three-month
and six-month periods ended March 31, 2000 are not necessarily indicative
of the result to be expected for the entire year.
(2) Loss per common share is based on the weighted average number of shares
outstanding during the period.
<PAGE>
Item 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
(Period Ending March 31, 1999)
Unaudited financial data
The discussion and analysis contained herein should be read in
conjunction with the preceding financial statements and the information
contained in the Company's 10SB. Except for the historical information contained
herein, the matters discussed in this 10 QSB contain forward looking statements
within the meaning of Section 27a of the Securities Act of 1933, as amended, and
Section 21e of the Securities Exchange Act of 1934, as amended, that are based
on management's beliefs and assumptions, current expectations, estimates, and
projections. Statements that are not historical facts, including without
limitation statements which are preceded by, followed by or include the words
"believes," "anticipates," "plans," "expects," "may," "should," or similar
expressions are forward-looking statements. Many of the factors that will
determine the company's future results are beyond the ability of the Company to
control or predict. These statements are subject to risks and uncertainties and,
therefore, actual results may differ materially. All subsequent written and oral
forward-looking statements attributable to the Company, or persons acting on its
behalf, are expressed qualified in their entirety by these cautionary
statements. The Company disclaims any obligation to update any forward-looking
statements whether as a result of new information, future events or otherwise.
Important factors that may include, but are not limited to: the risk of
a significant natural disaster, the inability of the Company to insure against
certain risks, fluctuations in commodity prices, the inherent limitations in the
ability to estimate oil and gas reserves, changing government regulations, as
well as general market conditions, competition and pricing, and other risks
detailed from time to time in the Company's SEC reports, copies of which are
available upon request from the Company.
Results of Operations -
Total Revenue for the second fiscal quarter increased 48 percent from
$163,902 in fiscal 1999 to $241,789 in fiscal 2000. For the six-month period
revenues increased 29 percent from $354,463 to $458,654. The increase in revenue
was due primarily to an increase in oil and gas sales
Total oil and gas sales (including royalty revenue) increased from
$145,198 to $240,044 in the second quarter and from $311,904 to $456,409 for the
six-month period. This increase was almost entirely due to higher product
prices. Average oil prices for the quarter increased from $10.03 bbl to $24.71
bbl while gas prices increased from $1.59 MCF to $1.97 MCF. For the six-month
period, average oil prices increased from $9.89 bbl to $23.14 bbl while gas
prices increased from $1.51 to $1.89. Gas production for the six-month period
increased by 24 percent as more wells were brought on line from our Mamm Creek
property. For the quarter gas production was flat due to downtime on our Willow
Creek and Pilot properties which offset Mamm Creek production increases. Oil
production declined 15 percent for the quarter and 21 percent for the six-month
period due to natural production declines and downtime due to operational
problems on our Climax 7-2 and Willow Creek properties.
<PAGE>
Project and lease sales income for the quarter dropped from $18,059 to
zero and for the six-month period from $33,163 to zero. No projects or lease
were sold during the first quarter or six-month period of fiscal 2000. The
company is currently developing several projects but none of them were ready for
sale during the quarter or six-month period.
Costs of operations decreased from $75,617 to $47,075 for the quarter
as many of the expenses for winterizing and repair were incurred in the first
quarter. For the six-month period operations expense declined from $150,855 to
$142,506.
General and administrative expenses increased from $75,514 to $110,277
for the quarter and from $145,392 to $220,460 for the six-month period. These
increases were due to salary increases for employees, costs associated with
becoming fully reporting and larger payments to working interest partners due to
higher product prices.
The Company's net income for the second quarter (fiscal 2000) was $6,468
compared to a loss of $88,678 for the second fiscal quarter 1999. For the
six-month period (fiscal 2000) the Company posted a loss of $59,690 compared to
a loss of $167,850 for fiscal 1999.
Liquidity and Capital Resources
During the six-months of fiscal 2000 cash used in operating
activities was $343,877 while investing provided no cash. Financing activities
provided $130,000 from the Company's bank line of credit. A major use of cash
was $144,623 for the purchase of resale leases to increase the Company's
inventory of acreage for future development and sale. Cash used in operating
activities declined from $461,095 (fiscal 1999) to $343,877 (fiscal 2000) almost
entirely due to the fact that in fiscal 1999 almost $250,000 was used to pay off
creditors in the Chapter 11 bankruptcy proceedings.
<PAGE>
PART II. OTHER INFORMATION
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 Security Holders
None.
Item 5 - Other Information
None.
Item 6 - Exhibits and Reports on Form 8-K
(a) There are no exhibits with this report.
(b) The registrant did not file any reports on Form 8-K during the
fiscal quarter ended March 31, 2000.
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.
Pioneer Oil and Gas
Dated: May 9, 2000 /s/ Don J. Colton
-----------------------------------
President and Chief Executive Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PIONEER OIL
AND GAS FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-END> SEP-30-1999
<CASH> 130,042
<SECURITIES> 0
<RECEIVABLES> 94,867
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 386,865
<PP&E> 883,407
<DEPRECIATION> 203,445
<TOTAL-ASSETS> 1,070,057
<CURRENT-LIABILITIES> 205,217
<BONDS> 0
0
0
<COMMON> 8,134
<OTHER-SE> 856,706
<TOTAL-LIABILITY-AND-EQUITY> 1,070,057
<SALES> 411,648
<TOTAL-REVENUES> 463,261
<CGS> 142,506
<TOTAL-COSTS> 520,728
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,223
<INCOME-PRETAX> (59,690)
<INCOME-TAX> 0
<INCOME-CONTINUING> (59,690)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (59,690)
<EPS-BASIC> (0.01)
<EPS-DILUTED> (0.01)
</TABLE>
