<PAGE>
<TABLE>
PART I. - FINANCIAL INFORMATION
GOLDEN CYCLE GOLD CORPORATION
BALANCE SHEETS
<CAPTION>
March 31, December 31,
1996 1995
(Unaudited)
_________ _________
<S>
<C> <C>
Assets
_________________________________________
Current assets:
Cash and cash equivalents $
59,228 $ 9,840
Short-term investments
492,426 354,118
Interest receivable and other current assets 15,298
492
_________ _________
Total current assets
566,951 364,450
Assets held for sale
176,907 176,907
Property and equipment
6,020 7,033
Investment in mining joint venture (Note 2)
- - - -
_________ _________
$ 749,878 $ 548,390
Liabilities and Shareholders' Equity
_________________________________________
Accounts payable and accrued liabilities $
7,461 $ 14,056
Deferred Revenue
20,000 20,000
Shareholders' equity:
Common Stock - no par value.
Authorized 3,500,000 shares; issued and
outstanding 1,573,050 shares
4,989,737 4,989,737
Additional paid-in capital
1,927,736 1,927,736
Accumulated deficit
(6,195,056) (6,403,139)
_________ _________
Total shareholders' equity
722,417 514,334
_________ _________
$ 749,878 $ 548,390
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>
<TABLE>
GOLDEN CYCLE GOLD CORPORATION
STATEMENTS OF OPERATION AND ACCUMULATED DEFICIT
FOR THE THREE MONTHS ENDED
March 31, 1996 AND 1995
(Unaudited)
<CAPTION>
Three
Months Ended
March 31,
____________________
1996
1995
_________
_________
<S> <C>
<C>
Revenue:
Distribution from mining joint
venture in excess of
carrying value $ 250,000
250,000
Other operating revenue 13,602 -
_________
_________
Total operating revenue 263,602 250,000
Expense, general and administrative (61,592) (77,438)
_________
_________
Operating income 202,010 172,562
Other income (expenses):
Interest and other income 6,073 6,476
Interest expense -
(2,210)
_________
_________
6,073
4,266
_________
_________
Net income $ 208,083 $
176,828
_________
_________
Income per share $ 0.13 $
0.11
Weighted average common
shares outstanding 1,573,050 1,571,050
ACCUMULATED DEFICIT:
Beginning of period $(6,403,139) $(6,405,420)
_________
_________
End of Period (6,195,056)
(6,228,592)
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>
<TABLE>
GOLDEN CYCLE GOLD CORPORATION
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED
March 31, 1996 and 1995
(Unaudited)
<CAPTION>
1996 1995
__________ __________
<S>
<C> <C>
Cash flows from operating activities:
Net Income
$ 208,083 $ 176,828
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation expense
1,013 1,195
Increase in interest receivable
and other current assets
(14,805) (1,866)
Increase (decrease) in accounts payable
and accrued liabilities
(6,595) 1,134
__________ __________
Net cash provided by operating activities
187,696 177,291
Cash flows used by investing activities:
Increase in short-term investments, net
(138,308) (130,416)
Cash flows from financing activities:
Cash used to retire note payable
- (500,000)
__________ __________
Net cash used by investing and
financing activities
(138,308) (630,416)
__________ __________
Net increase (decrease) in cash and
cash equivalents
49,388 (453,125)
Cash and cash equivalents, beginning of nine months
9,840 517,427
__________ __________
Cash and cash equivalents, end of nine months $
59,228 $ 64,302
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>
GOLDEN CYCLE GOLD CORPORATION
NOTES TO FINANCIAL STATEMENTS
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements (other than the Balance Sheet at
December 31, 1995) are unaudited but, in the opinion of management, include all
adjustments, consisting solely of normal recurring items, necessary for a fair
presentation. Interim results are not necessarily indicative of results for a
full year.
These financial statements should be read in conjunction with the financial
statements and notes thereto which are included in the Company's Annual Report
on Form 10-K for the year ended December 31, 1995. The accounting policies set
forth in those annual financial statements are the same as the accounting
policies utilized in the preparation of these financial statements, except as
modified for appropriate interim financial statement presentation.
(2) INVESTMENT IN JOINT VENTURE
The Company accounts for its investment in the Cripple Creek & Victor Gold
Mining Company (the "Joint Venture") on the equity method. During 1992, the
Company's investment balance in the Joint Venture was reduced to zero. Joint
Venture distributions in excess of the investment carrying value are recorded
as income, as the Company is not required to finance the Joint Venture's
operating losses or capital expenditures. Correspondingly, the Company does
not record its share of Joint Venture losses incurred subsequent to the
reduction of its investment balance to zero. To the extent the Joint Venture
is subsequently profitable, the Company will not record its share of equity
income until the cumulative amount of previously unrecorded Joint Venture
losses has been recouped. As of March 31, 1996, the company's share of
accumulated unrecorded losses from the Joint Venture is $4,376,658.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Company's principal mining investment and source of cash flows is its
interest in the Joint Venture. The Joint Venture engages in gold mining
activity in the Cripple Creek area of Colorado. The Company's Joint Venture
co-venturer is Pikes Peak Mining Company ("Pikes Peak"), a wholly-owned
subsidiary of Independence Mining Company.
The Company's rights and obligations relating to its Joint Venture interest
are governed by the Joint Venture Agreement. The Joint Venture is currently
operating in the Initial Phase, as defined. In accordance with the Joint
Venture Agreement, Pikes Peak manages the Joint Venture, and is required to
finance all operations and capital expenditures during the Initial Phase.
The Initial Phase will terminate after Initial Loans, as defined, have been
repaid and Net Proceeds (defined generally as gross revenues less operating
costs including Pikes Peak's administrative fees) of $58 million have been
distributed to the venture participants in the proportion of 80% to Pikes Peak
and 20% to the Company. Initial Loans generally constitute funds loaned to the
Joint Venture, and interest thereon, to finance operations and mine development
by either Pikes Peak or third-party financial institutions and are repayable
prior to distributions to the venture participants. The Manager reported
Initial Loans, payable to Pikes Peak, of approximately $143.37 million were
outstanding at March 31, 1996. To date, the Joint Venture has not earned or
distributed any Net Proceeds.
After the Initial Phase, the Joint Venture will distribute metal in kind in
the proportion of 67% to Pikes Peak and 33% to the Company, and the venture
participants will be responsible for their proportionate share of the Joint
Venture costs.
During the Initial Phase, the Company is entitled to receive a Minimum
Annual Distribution of $250,000. Minimum Annual Distributions received after
1993 constitute an advance of Net Proceeds. Accordingly, such Net Proceeds
advances will be recouped from future Net Proceeds distributions allocable to
the Company. Based on the amount of Initial Loans payable to the Manager and
the recurring operating losses incurred by the Joint Venture, management of the
Company believes that, absent a significant and sustained increase in the
prevailing market prices for gold, it is unlikely that the Company will receive
more than the Minimum Annual Distribution from the Joint Venture in the
foreseeable future.
The Company's working capital was approximately $559,000 at March 31, 1996
compared to $508,000 at March 31, 1995. Cash provided by operations was
approximately $188,000 and $177,000 in the 1996 and 1995 periods respectively.
Prior to 1993, the $250,000 Minimum Annual Distribution was classified as an
investing cash flow; beginning in 1993, the Minimum Annual Distribution was
reflected as an operating cash flow by reason of the fact that the Joint
Venture investment balance was reduced to zero during 1992, as discussed below
under "Results of Operations".
Working capital increased by approximately $51,000 at March 31, 1996
compared to March 31, 1995 due to larger net income for the first quarter of
1996 and retention of net income during 1995. Cash provided by operations
during the 1996 period increased from the 1995 period by approximately $11,000
primarily due to decreased general and administrative expenses.
On July 11, 1994 the Company borrowed $500,000 under a promissory note
bearing interest at 4.3%. The purpose of this loan was to bring the Company's
total assets to approximately $1.2 million, thereby exceeding the Pacific Stock
Exchange's (the "Exchange") minimum total asset criteria of $1,000,000 needed
to maintain Exchange's listing of the Company's equities. The $500,000 note
payable and accrued interest was paid on January 17, 1995 with proceeds from
liquidating the money market account. This was made possible by a change in
the Exchange's maintenance requirements which made the loan unnecessary. The
Company is not currently aware of any significant future capital commitments by
the Company.
Management believes that the Company's working capital, augmented by the
Minimum Annual Distribution, is adequate to support operations at the current
level for several years, barring unforeseen events. The possible inflow of
proceeds from the pending sale of water rights would further serve to
strengthen the Company's financial condition.
Results of Operations
The Company had net income, for the three months ended March 31, of
approximately $208,000 in 1996, compared to net income of approximately
$177,000 in 1994.
The increase in net income for the first three months of 1996 compared with
the same three months of 1995 of approximately $31,000 was due to a decrease of
approximately $16,000 in general and administrative expenses during the 1995
period as compared to the same three months of 1995, the elimination of
interest expense, and other operating income from a company in the Republic of
the Philippines during the first quarter 1996 of approximately $13,000.
The Company continues cost reduction measures implemented during 1995 and
anticipates that its budgeted general and administrative expenses in 1996 of
approximately $265,000 will be at a level below forecasted revenue, plus
interest income, of $270,000.
The Company accounts for its investment in the Joint Venture on the equity
method. During 1992, the Company's investment balance in the Joint Venture was
reduced to zero. Joint Venture distributions in excess of the investment
carrying value are recorded as income, as the Company is not required to
finance the Joint Venture's operating losses or capital expenditures.
Correspondingly, the Company does not record its share of Joint Venture losses
incurred subsequent to the reduction of its investment balance to zero. To the
extent the Joint Venture is subsequently profitable, the Company will not
record its share of equity income until the cumulative amount of previously
unrecorded Joint Venture losses has been recouped. As of March 31, 1996, the
Company's share of accumulated unrecorded losses from the Joint Venture is
$4,376,658.
The Joint Venture's audited financial statements show that the Joint
Venture incurred annual net losses of $3,654,000, $9,350,000, and $7,042,000 in
1995, 1994 and 1993 respectively. The Joint Venture achieved a net income of
$.186 million for the three months ended March 31, 1996.
PART II - OTHER INFORMATION
Item 1 through 4 are not being reported due to a lack of circumstances that
require a response.
Item 5. Other Information. None.
Item 6. Exhibits and Reports on Form 8-K.
None.
<PAGE>
GOLDEN CYCLE GOLD CORPORATION
SIGNATURES
Pursuant to 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.
THE GOLDEN CYCLE
GOLD CORPORATION
(Registrant)
May 13, 1996 Birl W. Worley Jr.
Birl W.
Worley Jr.
President & CEO
May 13, 1996 R. Herbert
Hampton
R.
Herbert Hampton
Vice
President, Finance
[ARTICLE] 5
[LEGEND]
Golden Cycle Gold Corporation
Financial Statements
[/LEGEND]
<TABLE>
<S> <C>
[PERIOD-TYPE] 3-MOS
[FISCAL-YEAR-END] DEC-31-1996
[PERIOD-END] MAR-31-1996
[CASH] 59,228
[SECURITIES] 492,426
[RECEIVABLES] 15,298
[ALLOWANCES] 0
[INVENTORY] 0
[CURRENT-ASSETS] 566,951
[PP&E] 708,240
[DEPRECIATION] 525,313
[TOTAL-ASSETS] 749,878
[CURRENT-LIABILITIES] 7,461
[BONDS] 0
[COMMON] 722,417
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 20,000
[TOTAL-LIABILITY-AND-EQUITY] 749,878
[SALES] 0
[TOTAL-REVENUES] 269,675
[CGS] 0
[TOTAL-COSTS] 61,592
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 0
[INCOME-PRETAX] 208,083
[INCOME-TAX] 0
[INCOME-CONTINUING] 208,083
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] 208,083
[EPS-PRIMARY] 0.13
[EPS-DILUTED] 0.12
</TABLE>
