<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
OMB Approval
OMB Number: xxxx-xxxx
Expires: Approval Pending
Estimated Average Burden Hours Per Response: 1.0
(Mark One)
xx Quarterly report under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended: June 30, 2000
__ Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from ____________ to _____________
Commission file number: 0-3912
PETROL INDUSTRIES, INC.
(Exact Name of Small Business Issuer as Specified in its Charter)
NEVADA 75-1282449
(State or Other Jurisdiction of (IRS Employer Identification No.)
Incorporation of Organization)
202 N. THOMAS, SUITE 4 318-424-6396
SHREVEPORT, LA 71107-6539 (Issuer's Telephone Number,
(Address of Principal Executive Offices) Including Area Code)
N/A
(Former Name, Former Address and Former Fiscal Year,
if Changed Since Last Report)
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 (XX) No ( )
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to
be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.
Yes___ No____
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 1,597,196
<PAGE> 2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
PETROL INDUSTRIES, INC. & SUBSIDIARIES
Consolidated Balance Sheets
June 30, December 31,
2000 1999
ASSETS --------- ------------
------ (unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 73,205 34,138
Accounts receivable:
Trade 78,027 67,542
Other 9,497 9,663
---------- ----------
87,524 77,205
Inventory 41,443 40,406
Prepaid expenses 12,834 6,073
---------- ----------
Total current assets 215,006 157,822
---------- ----------
Property and equipment, at cost:
Land 7,000 7,000
Developed and undeveloped oil and gas
properties-successful efforts method 4,141,211 4,141,705
Trucks and other operating equipment 357,774 367,984
Furniture and fixtures 32,758 46,720
---------- ----------
4,538,743 4,563,409
Less accumulated depreciation, depletion
and amortization 4,469,808 4,504,275
---------- ----------
68,935 59,134
---------- ----------
Other assets 1,107 1,107
---------- ----------
$ 285,048 218,063
========== ==========
LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------
Current liabilities:
Accounts payable $ 40,471 44,667
Payable to interest owners 324,761 321,106
Payable to officer, net 804,825 722,194
Note payable 50,000 50,000
Accrued expenses 111,009 100,342
---------- ----------
Total current liabilities 1,331,066 1,238,309
---------- ----------
Stockholders' deficit:
Preferred stock-no par value. Authorized
1,000,000 shares; no shares issued or
outstanding --- ---
Common stock-$.10 par value. Authorized
10,000,000 shares; issued and outstanding
1,597,196 shares in 1999 and 1998 159,720 159,720
Accumulated deficit (1,205,738) (1,179,966)
---------- ----------
Total stockholders' deficit (1,046,018) (1,020,246)
---------- ----------
$ 285,048 218,063
========== ==========
</TABLE>
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<TABLE>
PETROL INDUSTRIES, INC.
Consolidated Statements of Operations
(unaudited)
Quarter Ended Year Ended
June 30, June 30,
--------------------- ---------------------
2000 1999 2000 1999
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
REVENUES:
Oil and gas sales $ 167,609 119,639 372,573 198,110
Other operating income 7,263 6,532 17,007 10,203
--------- --------- --------- ---------
174,872 126,171 389,580 208,313
--------- --------- --------- ---------
EXPENSES:
Lease operating expense 121,093 95,541 245,572 184,223
General and administrative 76,753 69,099 145,245 139,525
Depreciation, depletion
And amortization 1,740 2,250 3,406 4,500
199,586 166,890 394,223 328,248
--------- --------- --------- ---------
Operating loss $ (24,714) (40,719) (4,643) (119,935)
--------- --------- --------- ---------
OTHER INCOME AND (EXPENSE):
Gain on sale of assets 1,000 --- 1,000 ---
Interest income 463 66 650 336
Interest expense (11,697) (8,346) (22,779) (16,099)
--------- --------- --------- ---------
(10,234) (8,280) (21,129) (15,763)
--------- --------- --------- ---------
Net loss $ (34,948) (48,999) (25,772) (135,698)
========= ========= ========= =========
Net loss per share $ (0.02) (0.03) (0.02) (0.08)
========= ========= ========= =========
Average common shares
outstanding 1,597,196 1,597,196 1,597,196 1,597,196
========= ========= ========= =========
</TABLE>
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<TABLE>
PETROL INDUSTRIES, INC. & SUBSIDIARIES
Consolidated Statements of Cash Flows
Six months ended June 30, 2000 and 1999
(unaudited)
2000 1999
---- ----
<S> <C> <C>
Operating activities:
Net income/(loss) $ (25,772) (135,698)
Adjustments to reconcile net loss to net cash
(used) provided by operating activities:
Gain/(loss) on sale of assets 1,000 ---
Depreciation, depletion and amortization 3,406 4,500
Losses on retirements of property and equipment
included in lease operating expenses (507) 724
Changes in assets and liabilities:
Accounts receivable (10,319) (14,626)
Inventory (1,037) (8,497)
Prepaid expenses (6,761) (4,489)
Accounts payable and accrued expenses 6,471 5,023
Payable to officer, net 82,631 78,601
Payable to interest owners 3,655 2,488
------- --------
Net cash provided (used) provided by
operating activities 52,767 (71,974)
Investing activities:
Capital expenditures (13,700) ---
-------- --------
Net cash (used) provided by investing
activities (13,700) ---
Financing activities:
Purchase and retirement of common stock --- ---
Proceeds from gross borrowings --- 50,000
-------- --------
Net cash provided by financing activities --- 50,000
Increase/(decrease) in cash and cash equivalents 39,067 (21,974)
Cash and cash equivalents at beginning of period 34,138 56,729
-------- --------
Cash and cash equivalents at end of period $ 73,205 34,755
======== ========
</TABLE>
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<TABLE>
PETROL INDUSTRIES, INC.
Consolidated Statements of Changes in Stockholders' Deficit
Six months ended June 30, 2000 and 1999
(unaudited)
2000 1999
---- ----
<S> <C> <C>
Stockholders' deficit at January 1 $ (1,020,246) (835,115)
Net loss for the six-month period (25,772) (135,698)
----------- ---------
Stockholders' deficit at June 30 $ (1,046,018) (970,813)
=========== =========
</TABLE>
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PETROL INDUSTRIES, INC. & SUBSIDIARIES
Notes to Consolidated Financial Statements
(unaudited)
1. The accompanying unaudited consolidated financial statements have been
prepared by the Registrant in accordance with generally accepted accounting
principles, pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in financial statements have been condensed or omitted pursuant to
such rules and regulations, although management believes that the
disclosures are adequate to make the information presented not misleading.
In the opinion of management, the accompanying financial statements
contain all adjustments necessary for a fair statement of the results for
the interim periods presented. It is suggested that these consolidated
financial statements be used in conjunction with the consolidated
financial statements and the notes thereto included in the Registrant's
1999 Annual Report on Form 10-KSB.
2. The consolidated financial statements included herein are consolidated
with the accounts of Petrolind Drilling Funds, Inc. and Realco, Inc., both
wholly owned subsidiaries of the Registrant, neither of which was active
during 2000 or 1999.
3. Net income per share of common stock is computed on the weighted average
number of shares outstanding during the six months ended June 30.
Totaling the number of shares outstanding at the end of each month and
dividing that total by the number of months determined the weighted
average number of shares outstanding.
TOTAL NUMBER OF
SHARES OUTSTANDING
------------------
2000 1999
---- ----
January 31 1,597,196 1,597,196
February 29 1,597,196 1,597,196
March 31 1,597,196 1,597,196
April 30 1,597,196 1,597,196
May 31 1,597,196 1,597,196
June 30 1,597,196 1,597,196
4. The expected tax benefit resulting from operating losses for the first six
months of 2000 has not been recorded because it is not expected to be
realizable. Additionally, there were no significant changes in the
temporary differences that give rise to significant portions of the
deferred tax assets and deferred tax liabilities at June 30, 2000.
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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Oil and gas sales revenues increased approximately 40.1% in the second
quarter of 2000, compared to the second quarter of 1999, the result being an
approximate 69.6% increase in average oil prices of approximately $10.44 per
barrel. The Company's net loss for the period decreased to $34,948, or
($.02) per share, compared to $48,999 in the 1999 period, or ($.03) per
share.
The Company sustained an operating loss of $24,714 in the second quarter
of 2000, compared to an operating loss of $40,719 in the prior year's second
quarter. For the six-month period ended June 30, 2000, the Company's net
loss decreased approximately 81% to $25,772 from the $135,698 net loss in the
prior year's period.
Management has attempted to reduce operating costs over the past several
years in an effort to restore profitability. Profitability is contingent
essentially upon two factors: increasing production from the Company's
mineral leases and increases in world oil prices. Management continues to
explore possible approaches to increasing oil production, including
technological developments or pursuing drilling operations.
Oil prices averaged $25.45 per barrel during the second quarter of 2000,
compared to an average of $15.01 per barrel in the 1999 period. For the six-
month period, oil prices averaged $25.60 per barrel in 2000 compared to
$12.87 in 1999.
The Company had cash and cash equivalents at June 30, 2000, of $73,205,
compared to $34,138 at the end of the 1999 fiscal year. Management estimates
that it owes $324.761 from the settlement of the Horne Lease dispute with
Oryx to owners of other interests in the Horne Lease.
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.
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SIGNATURE
---------
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: August 11, 2000
PETROL INDUSTRIES, INC.
By: s/Joseph M. Rodano
--------------------------
Joseph M. Rodano
President and Treasurer
<PAGE> 9
EXHIBIT INDEX
Exhibit
No. Description
------- -----------
27 Financial Data Schedule
