SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to
Commission File Number: 0-13078
LEADVILLE MINING AND MILLING CORP.
(Exact name of registrant as specified in its charter)
NEVADA #13-3180530
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
76 BEAVER STREET, NEW YORK, NEW YORK 10005
(Address of Principal Executive Offices) (Zip Code)
Issuer's Telephone Number, Including Area Code (212) 344-5158
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 _X_ No ___
Indicate the number of shares outstanding of each the issuer's classes of common
equity as of the latest practicable date.
Class Outstanding at January 31, 1998
Common Stock, par value 15,631,188 Shares
$.001 per share
Transitional Small Business Format (check one); Yes ___ No _X_
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying financial statements are unaudited for the interim period,
but include all adjustments (consisting only of normal recurring accruals) which
management considers necessary for the fair presentation of results for the
three months ended January 31, 1998.
Moreover, these financial statements do not purport to contain complete
disclosure in conformity with generally accepted accounting principles and
should be read in conjunction with the Company's audited financial statements
at, and for the fiscal year ended July 31, 1997.
The results reflected for the three months ended January 31, 1998 are not
necessarily indicative of the results for the entire fiscal year.
2
<PAGE>
LEADVILLE MINING AND MILLING CORP.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
JANUARY 31, 1998
(Unaudited)
ASSETS
Current Assets:
Cash $ 48,353
Loan Receivable 2,574
Other Current Assets 200
----------
Total Current Assets 51,127
Property and Equipment (Net of
Accumulated Depreciation of $347,316) 1,358,335
----------
Other Assets:
Mining Reclamation Bonds 11,000
Security Deposit 3,667
----------
Total Other Assets 14,667
Total Assets $1,424,129
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accrued Expenses and Taxes $ 63,745
-----------
Commitments and Contingencies
Stockholders' Equity:
Common Stock, Par Value $.001 Per Share;
Authorized 150,000,000 shares; Issued and
Outstanding 15,631,188 Shares 15,631
Capital Paid In Excess of Par Value 7,280,319
Deficit Accumulated in the Development Stage (5,935,566)
-----------
Total Stockholders' Equity 1,360,384
-----------
Total Liabilities and Stockholders' Equity $ 1,424,129
-----------
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
LEADVILLE MINING AND MILLING CORP.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For The Period
Three Months Ended Six Months Ended September 17,1982
January 31, January 31, (Inception)
------------------------------ ------------------------------- To
1998 1997 1998 1997 January 31, 1998
------------- ------------- ------------- ------------- ----------------
<S> <C> <C> <C> <C> <C>
Revenues:
Interest Income $ 226 $ 194 $ 442 $ 414 $ 708,676
Miscellaneous -- -- -- -- 24,706
------------- ------------- ------------- ------------- -------------
Total Revenues 226 194 442 414 733,382
------------- ------------- ------------- ------------- -------------
Costs and Expenses:
Mine Expenses 183,467 73,734 341,235 163,735 2,022,861
Selling, General and
Administrative Expenses 48,061 66,256 83,041 261,424 4,161,373
Depreciation 1,242 1,216 2,484 3,156 347,316
Loss on Write-Off of
Investment -- -- -- -- 10,000
Loss on Joint Venture -- -- -- -- 101,700
------------- ------------- ------------- ------------- -------------
Total Costs and 232,770 141,206 426,760 428,315 6,643,250
------------- ------------- ------------- ------------- -------------
Expenses
Loss Before Provision
For Income Taxes (232,544) (141,012) (426,318) (427,901) (5,909,868)
Provision For Income 344 -- 1,032 688 25,698
------------- ------------- ------------- ------------- -------------
Taxes
Net Loss $ (232,888) $ (141,012) $ (427,350) $ (428,589) $ (5,935,566)
============= ============= ============= ============= =============
Net Loss Per Share $ (0.02) $ (0.00) $ (0.03) $ (0.00)
============= ============= ============= =============
Average Common
Shares Outstanding 15,392,596 132,804,988 15,034,730 132,612,947
============= ============= ============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
LEADVILLE MINING AND MILLING CORP.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended For The Period
January 31, September 17, 1982
-------------------------- (Inception)
To
1998 1997 January 31, 1998
----------- ----------- ----------------
<S> <C> <C> <C>
Cash Flow From Operating Activities:
Net Loss $ (427,350) $ (428,589) $(5,935,566)
Adjustments to Reconcile Net Loss to
Net Cash Used By Operating Activities:
Depreciation 2,484 3,156 347,316
Loss on Write-Off of Investment -- -- 10,000
Loss From Joint Venture -- -- 101,700
Value of Common Stock Issued For Services 14,596 3,858 1,476,154
Compensation Portion of Options Exercised 33,475 98,000 294,975
Changes in Operating Assets and Liabilities:
Decrease in Prepaid Expenses -- 50,212 --
(Increase) Decrease in Other Current Assets 776 (179) (200)
(Increase) in Security Deposit -- -- (3,667)
Increase in Accrued Expenses and Taxes 7,835 4,155 63,745
Net Cash Used By Operating Activities (368,184) (269,387) (3,645,543)
Cash Flow From Investing Activities:
Purchase of Property and Equipment -- (3,500) (1,705,650)
Investment in Joint Venture -- -- (101,700)
Investment in Privately Held Company -- -- (10,000)
Net Cash Used By Investing Activities -- (3,500) (1,817,350)
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
LEADVILLE MINING AND MILLING CORP.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS
(Unaudited)
(Continued)
<TABLE>
<CAPTION>
For The Period
Six Months Ended September 17, 1982
January 31, (Inception)
------------------------- To
1998 1997 January 31, 1998
----------- ----------- ----------------
<S> <C> <C> <C>
Cash Flow From Investing Activities:
(Increase) Decrease in Loans Receivable $ 3,252 $ 7,908 $ (2,574)
Increase in Loans Payable - Officers -- -- 18,673
Repayment of Loans Payable - Officers -- -- (18,673)
Proceeds From Sale of Common Stock 385,775 261,181 5,938,833
Commissions on Sale of Common Stock -- -- (5,250)
Expenses of Initial Public Offering -- -- (408,763)
Combined Purchase of Certificate of Deposit-Restricted -- -- (5,000)
Combined Purchase of Mining Reclamation Bond -- -- (6,000)
----------- ----------- -----------
Net Cash Provided By Financing Activities 389,027 269,089 5,511,246
----------- ----------- -----------
Increase (Decrease) In Cash and Cash Equivalents 20,843 (3,798) 48,353
Cash and Cash Equivalents - Beginning 27,510 34,857 --
----------- ----------- -----------
Cash and Cash Equivalents - Ending $ 48,353 $ 31,059 $ 48,353
=========== =========== ===========
Supplemental Cash Flow Information:
Cash Paid For Interest $ -- $ -- --
=========== ===========
Cash Paid For Income Taxes $ 344 $ 688 $ 24,459
=========== =========== ===========
Non-Cash Financing Activities:
Issuances of Common Stock as Commissions
on Sales of Common Stock $ 101,860 $ 24,297 $ 165,007
=========== =========== ===========
Issuances of Common Stock as
Payment For Expenses $ 14,596 $ -- $ 21,562
=========== =========== ===========
Issuance of Common Stock For
Acquisition of Property and Equipment $ -- $ 4,500 $ 4,500
=========== =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
LEADVILLE MINING AND MILLING CORP.
(A DEVELOPMENT STAGE ENTERPRISE
NOTES TO FINANCIAL STATEMENTS
JANUARY 31, 1998
(Unaudited)
NOTE 1 - Basis of Presentation
In the opinion of the Company, the accompanying unaudited financial
statements reflect all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and cash flows for the periods presented.
Moreover these financial statements do not purport to contain complete
disclosure in conformity with generally accepted accounting principles and
should be read in conjunction with the Company's audited financial statements at
and for the fiscal year ended July 31, 1997.
Results of operations for interim periods are not necessarily indicative of
the results of operations for a full year due to external factors which are
beyond the control of the Company.
7
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operation
Cautionary Statement on Forward-Looking Statements
Except for the historical information contained herein, certain of the matters
discussed in this quarterly report are "forward-looking statements", as defined
in Section 21E of the Securities and Exchange Act of 1934, which involve certain
risks and uncertainties, which could cause actual results to differ materially
from those discussed herein including, but not limited to, risks relating to
changing economic conditions, changes in the prices of minerals and the results
of testing and actual mining.
The Company cautions readers that any such forward-looking statements are based
on management's current expectations and beliefs but are not guarantees of
future performance. Actual results could differ materially from those expressed
or implied in the forward-looking statements.
Results of Operations
Once again the Company generated no revenues from operations because the Company
has yet to commence mining activities.
Mine expenses increased by $109,733 (approximately 59.8%) from $73,734 during
the three months ended January 31, 1997 to 183,467 during the three months ended
January 31, 1998. Management believes that this increase in mine expenses was
due primarily to additional labor costs, exploration, equipment, parts and
supplies.
Selling, general and administrative expenses decreased by $18,195 (approximately
37.9%) from $66,256 during the three months ended January 31, 1997 to $48,061
during the three months ended January 31, 1998. Management believes that this
decrease in selling, general and administrative expenses was due primarily to a
decrease in financial costs.
As a result of mine expense increases, and a small decrease in the cost of
selling and administration, the net loss increased by $91,876 (approximately
39.4%) from $141,012 during the three months ended January 31, 1997 to $232,888
during the three months ended January 31, 1998.
During the three months ending January 31, 1998, the Company continued to drive
the escape tunnel towards the Hunter shaft target. The tunnel has reached a
point very close to its final destination. It has been provided with rail track,
air vent, compressed air pipe, water line and electric cable.
Exploration continued with sampling and assaying at numerous points in the
mineralized area. Precious metals were found to be commercial. The ore crusher
has been furnished with a low voltage starter. The mill has been tested and is
ready for commercial operation.
8
<PAGE>
Liquidity and Capital Resources
As of January 31, 1998, the Company had a working capital deficiency of $12,618
(defined as current assets less current liabilities) which represents a net
decrease in working capital of $12,989 from October 31, 1997. As was explained
in the Company's 10-KSB, the Company is in a precarious financial condition and
there is no assurance whatsoever that the Company will be able to continue as a
going concern or that any of its plans with respect to its gold mining
properties will come to fruition. The Company, in order to continue its mine
program must obtain substantial financing. While management is seeing such
financing through joint venture partners, private placement of its shares and
other arrangements, there is no assurance that management will succeed therein.
It should be emphasized that the Company's financial condition has remained
critical since the date of the last 10-KSB and that in order to survive, the
Company will need an infusion of capital within the near future.
9
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities and Use of Proceeds
During the quarter ended January 31, 1998, the Company issued the following
shares of its common stock pursuant to the exemption from registration provided
by Section 4(2) of the Securities Act of 1933. In November 1997, the Company
sold an aggregate of 250,658 shares to ten individuals for an aggregate of
$117,500. In December 1997, the Company sold an aggregate of 85,850 shares to
five individual for an aggregate of $42,850 and issued 266,000 shares to one
individual for 10% commission on cash sales and issued to two individual for
expenses 99,000 shares for an aggregate of $34,650. In January 1998, the Company
sold an aggregate of 51,000 shares to four individuals for an aggregate of
$24,400.
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
None
10
<PAGE>
FORM 10-QSB
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 thereto duly authorized.
LEADVILLE MINING & MILLING CORP.
Registrant
March 16, 1998 By: /s/ GIFFORD A. DIETERLE
-------------------------------------------
Gifford Dieterle, V.P./Treasurer/Secretary
11
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUL-31-1998
<PERIOD-START> AUG-01-1997
<PERIOD-END> JAN-31-1998
<CASH> 48,353
<SECURITIES> 0
<RECEIVABLES> 2,574
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 51,127
<PP&E> 1,705,651
<DEPRECIATION> 347,316
<TOTAL-ASSETS> 1,424,129
<CURRENT-LIABILITIES> 63,745
<BONDS> 0
0
0
<COMMON> 15,631
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 1,424,129
<SALES> 0
<TOTAL-REVENUES> 226
<CGS> 0
<TOTAL-COSTS> 341,235
<OTHER-EXPENSES> 85,525
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (426,318)
<INCOME-TAX> 1,032
<INCOME-CONTINUING> (427,350)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (427,350)
<EPS-PRIMARY> (0.03)
<EPS-DILUTED> 0
</TABLE>
