VINEYARD OIL & GAS COMPANY
10299 West Main Road
North East, PA 16428
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
Pursuant to the requirements of the Securities Exchange Act of 1934, we are
transmitting herewith the attached Form 10-QSB.
Sincerely,
Vineyard Oil & Gas Company
James J. Concilla
President
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended September 30, 1997
Commission File Number 0-13871
Pennsylvania 25-1349204
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10299 West Main Road, North East, Pennsylvania 16428-0391
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (814) 725-8742
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 [ X ] NO [ ]
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practical
date:
Common Stock, No Par Value - 5,125,562.50 shares as of September 30, 1997
<PAGE>
<TABLE>
PART 1 - FINANCIAL INFORMATION
BALANCE SHEETS (UNAUDITED)
VINEYARD OIL & GAS COMPANY
<CAPTION>
September 30, December 31,
1997 1996
<S> <C> <C>
ASSETS
Current Assets
Cash $ 640,363 $ 281,186
Accounts receivable 1,441,893 3,667,173
Inventories 180,622 198,686
Prepaid Expenses 26,594 22,346
__________ __________
Total Current Assets 2,289,472 4,169,391
Property, Plant and Equipment 8,581,971 8,577,994
Accumulated depreciation 8,039,572 7,975,647
_________ __________
542,399 602,347
Deferred Costs and Other Assets
Cash restricted 347,958 325,737
Other noncurrent assets 195,527 130,683
__________ __________
543,485 456,420
__________ __________
TOTAL ASSETS (NOTE) $ 3,375,356 $ 5,228,158
__________ __________
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable $ 1,674,170 $ 3,515,682
Other accrued liabilities 36,067 52,295
Current portion, long term debt 0 48,132
__________ __________
Total Current Liabilities 1,710,237 3,616,109
Long Term Debt - less current portion 0
Deferred revenue 389,880 382,293
Shareholder's Equity Common Stock, authorized
15,000,000 shares without par value, issued
5,125,562.5 shares at September 30, 1997,
at stated value of $.05 256,278 256,278
Additional paid-in capital 4,935,430 4,935,430
__________ __________
5,191,708 5,191,708
Retained earnings (deficit) (3,691,549) (3,737,032)
__________ __________
1,500,159 1,454,676
Less: cost of 67,944 shares held in treasury ( 224,920) ( 224,920)
__________ __________
1,275,239 1,229,756
__________ __________
$ 3,375,356 $ 5,228,158
__________ __________
<FN>
See notes to condensed financial statements.
</TABLE>
<PAGE>
<TABLE>
PART I. - FINANCIAL INFORMATION
STATEMENTS OF INCOME AND RETAINED EARNINGS (UNAUDITED)
FOR THE THREE MONTHS AND NINE MONTHS
ENDED SEPTEMBER 30, 1997 AND 1996
VINEYARD OIL & GAS COMPANY
<CAPTION>
3 Months 3 Months 9 Months 9 Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Earned revenues $ 1,816,242 $ 1,883,818 $ 6,724,704 $ 4,737,151
Other Income 7,585 4,044 52,592 52,228
__________ __________ __________ __________
1,823,827 1,887,862 6,777,296 4,789,379
Cost of Earned Revenues 1,724,740 1,907,899 6,402,366 4,394,636
Selling, general and
administrative expenses 119,255 113,054 327,014 313,203
Interest 194 2,349 2,434 8,596
__________ __________ __________ __________
1,844,189 2,023,302 6,731,814 4,716,435
__________ __________ __________ __________
Income before income taxes (20,362) (135,440) 45,482 72,944
Income taxes 0 0 0 0
__________ __________ __________ __________
Net Income (20,362) (135,440) 45,482 72,944
Retained Earnings (Deficit)
Beginning of period (3,671,187) (3,535,748) (3,737,031) (3,744,132)
__________ __________ __________ __________
Retained Earnings (Deficit)
End of period (3,691,549) (3,671,188) (3,691,549) (3,671,188)
__________ __________ __________ __________
Income per common share (.004) (.027) .009 .014
__________ __________ __________ __________
<FN>
See Accompanying Notes to Financial Statements
00</TABLE>
STATEMENTS OF CASH FLOWS (UNAUDITED)
VINEYARD OIL & GAS COMPANY
FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
[CAPTION]
<TABLE>
3 Months 3 Months 9 Month 9 Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Cash flow from operating
activities:
Income (loss) from operations $ (20,362)$ (135,440) $ 45,482 $ 72,944
Adjustments To Reconcile Net
Income to Net Cash Provided by
Operating Activities:
Depreciation and amortization 20,185 28,261 63,925 73,942
Provision for losses on
accounts receivable and
inventories 0 6,000 12,000 12,000
Gain on sale of property
Changes in operating assets
and liabilities providing
(using cash):
Accounts receivable 557,983 (621,813) 2,213,280 (211,576)
Inventories (6,551) (12,337) 18,064 (23,598)
Prepaid expenses 13,148 9,458 (4,248) 24,869
Other assets (27,418) (25,368) (64,844) (67,449)
Accounts payable (203,125) 584,899 (1,841,512) (3,900)
Other current liabilities 14,813 55,790 (16,228) 16,067
Deferred revenue 2,412 4,449 7,587 13,879
__________ __________ ________ _________
Net cash provided by (used in)
operating activities 351,085 (106,101) 433,506 (92,822)
__________ __________ ________ _________
Cash flow from investing
activities:Capital expenditures (3,976) (20,241) (3,976) (78,334)
Common Stock 0 0 0 0
__________ __________ ________ _________
Net cash used in investing
activities (3,976) (20,241) (3,976) (78,334)
__________ __________ ________ _________
Cash flow from financing
activities:Principal payments
on borrowings (11,996) (20,221) (48,132) (59,111)
__________ __________ ________ _________
Net cash (used in) financing
activities (11,996) (20,221) (48,132) (59,111)
__________ __________ ________ _________
Increase (Decrease) in cash 335,113 (146,563) 381,398 (230,267)
Cash at beginning of period 653,208 779,741 606,923 863,445
__________ __________ ________ _________
Cash at end of period $ 988,321 $ 663,178 $ 988,321 $ 633,178
__________ __________ ________ _________
<FN>
See notes to condensed financial statements.
</TABLE>
VINEYARD OIL & GAS COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
1. In the opinion of the Company, the accompanying condensed financial
statements contain all adjustments(consisting only of normal accruals)necessary
to present fairly the results for the nine months ended September 30, 1997, and
are not necessarily indicative of the results to be expected for the full year.
2. Primary earnings per share are determined by dividing net income by the
weighted average number of common equivalent shares outstanding (5,125,562.50
in 1997 and 1996).
3. No federal income tax was due or paid during the period ending September 30,
1997, due to available operating loss carry forwards.
4. Long-term debt is summarized as follows:
[CAPTION]
<TABLE>
September, 30, 1997 December 31, 1996
<S> <C> <C>
Mortgage payable individual,
secured by all assets of the
Company, payable in monthly
payments of $7,523, including
interest at 10.5%, through
September, 1997. $ 0 $ 48,132
__________ __________
0 48,132
Current portion long-term debt 0 (48,132)
__________ __________
$ 0 $ 0
__________ __________
</TABLE>
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
IN THE QUARTER ENDED SEPTEMBER 30, 1997
Material Changes in Financial Conditions
Vineyard Oil & Gas Company's cash position increased $381,398 for the nine
month period end September 30, 1997, $335,113 of which occurred in the three
month period ending September 30, 1997. The net increase in cash resulting
from receivable collections and payment of accounts payable was $367,119 for
the nine month period and $354,858 for the three month period, accounting for
the majority of the cash increase. Inventories decreased slightly, $18,064, or
9%, in the nine month period due to normal activity. The increase in other
assets of $64,844 and $27,418 for the nine and three month periods was due
principally to additional investment in a limited liability corporation. Other
current liabilities did not vary materially.
The Company had capital expenditures of $3,976 in the nine month period
ended September 30, 1997. The allowance for depreciation increased $63,925,
and $20,185 for the nine and three month periods, the amount of depreciation
and amortization charged to operations.
Long term debt decreased $48,132 and $11,996 for the nine and three month
periods ended September 30, 1997. The debt was paid off in August, 1997, and
no new debt was incurred as of September 30, 1997.
Shareholders' equity increased $45,482 for the nine month period and
decreased $20,362 for the three month period. These changes represent the
results of operations for the respective periods.
Material Changes and Results of Operations
Earned revenues increased $1,987,553 for the nine month period and
decreased $67,576 for the three month period ended September 30, 1997, as
compared to similar periods in 1996. The major reason for the nine month
increase is the increase in volume of natural gas sales in 1997 of $1,925,143.
Gas marketing comprises 87% of total revenues. The same is true for cost of
earned revenues. Of the increase of $2,007,730 in costs, gas purchases
increased $1,964,953. Gas purchases comprise 87% of the total cost of earned
revenues.
Selling, general and administrative expenses increased $13,811, or 4%, for
the nine month period and $6,201, or 5%, for the three month period ended
September 30, 1997, as compared to the same periods in 1996. There were no
unusual increases within this area. Interest expense decreased $6,162 and
$2,155 for the nine and three month period due to decreasing loan balances
during the period.
Net income decreased $27,462 for the nine month period and increased
$115,078 for the three month period ended September 30, 1997, as compared to
similar periods in 1996. The three month increase over 1996 is due to
increased marketing activity over the three month period as compared to the
same period in 1996.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
____________________________
NOT APPLICABLE
ITEM 2. CHANGES IN SECURITIES
________________________________
NOT APPLICABLE
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
__________________________________________
NOT APPLICABLE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
______________________________________________________________
NOT APPLICABLE
ITEM 5. OTHER INFORMATION
____________________________
NOT APPLICABLE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
___________________________________________
(a) EXHIBITS
________
NONE
(b) REPORTS ON FORM 8-K
___________________
NONE.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<EXCHANGE-RATE> 1
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 640,363
<SECURITIES> 0
<RECEIVABLES> 1,556,962
<ALLOWANCES> 115,069
<INVENTORY> 180,622
<CURRENT-ASSETS> 2,289,472
<PP&E> 8,581,971
<DEPRECIATION> 8,039,572
<TOTAL-ASSETS> 3,375,356
<CURRENT-LIABILITIES> 1,710,237
<BONDS> 0
<COMMON> 256,278
0
0
<OTHER-SE> 1,018,961
<TOTAL-LIABILITY-AND-EQUITY> 3,375,356
<SALES> 6,724,704
<TOTAL-REVENUES> 6,777,296
<CGS> 6,402,366
<TOTAL-COSTS> 6,402,366
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,434
<INCOME-PRETAX> 45,482
<INCOME-TAX> 0
<INCOME-CONTINUING> 45,482
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 45,482
<EPS-PRIMARY> .01
<EPS-DILUTED> .01
</TABLE>
