SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
/x/ QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE EXCHANGE ACT OF 1934.
For the Quarterly Period Ended September 30, 1997.
or
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
Commission File Number 33-4844-D
AMERICANA GOLD & DIAMOND HOLDINGS, INC.
DELAWARE 84-1023321
(State or other Jurisdiction of (I.R.S. Employer Identification Number)
Incorporation or Organization)
Calle Los Laboratorios,
Torre Beta, Piso 2, Ofic. 208
Caracas, Venezuela. 1071
(Address of principal executive offices) (Zip code)
(Telephone) (58-2) 238-23-32 (Fax) (58-2) 239-84-29
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__
The number of shares outstanding of the registrant's common stock is 12,692,683
(as of November 11, 1997).
<PAGE>
AMERICANA GOLD & DIAMOND HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. GENERAL
The accompanying unaudited consolidated financial statements have
been prepared in accordance with the instructions for Form 10-QSB and therefore
do not include all information and footnotes necessary for a fair presentation
of financial position, results of operations and changes in cash flows in
conformity with generally accepted accounting principles. The unaudited
consolidated financial statements should be read in conjunction with the
financial statements and related notes for the year ended December 31, 1996,
included in the Company's Form 10-KSB. In the opinion of management the
unaudited consolidated financial statements contain all adjustments necessary
for a fair presentation of the results of operations for the interim period
presented and all such adjustments are of a normal and recurring nature.
However, the results of operations for the three and nine months ended September
30, 1997 are not necessarily indicative of the results which may be expected for
the entire fiscal year.
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<PAGE>
AMERICANA GOLD & DIAMOND HOLDINGS, INC. & SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - AS OF SEPTEMBER 30, 1997
(Expressed in U.S. dollars)
SEPTEMBER 30, DECEMBER 31,
1997 1996
(UNAUDITED) (AUDITED)
----------- ---------
ASSETS
CURRENT ASSETS:
Cash 12,796 133,280
Prepaid Expenses and Other Current Assets 59,243 41,215
---------- ----------
Total Current Assets 72,039 174,495
FIXED ASSETS, Net 278,070 322,053
MINING CONCESSION 9,543,850 9,359,961
OTHER ASSETS 515,031 515,677
---------- ----------
10,408,990 10,372,186
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Bank Loans 217,219 170,000
Accounts Payable 153,209 15,968
Accrued Liabilities 5,452 13,942
---------- ----------
Total Current Liabilities 375,880 199,910
LONG-TERM ACCOUNTS PAYABLE 2,959,389 2,960,251
PROVISIONS FOR EMPLOYEE SEVERANCE BENEFITS 12,727 6,843
---------- ----------
Total Liabilities 3,347,996 3,167,004
---------- ----------
STOCKHOLDERS' EQUITY
Capital Stock 11,430,829 11,144,840
Acumulated Losses ( 4,343,864) ( 3,939,658)
Deduct treasury stock ( 25,971) 0
---------- ----------
Total Stockholders' Equity 7,060,994 7,205,182
---------- ----------
10,408,990 10,372,186
========== ==========
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<PAGE>
AMERICANA GOLD & DIAMOND HOLDINGS, INC. & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(Expressed in U.S. dollars)
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30, THREE MONTHS ENDED SEPTEMBER 30,
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
ADMINISTRATION EXPENSES (401,954) (331,334) (123,902) (141,733)
------- ------- -------- -------
OTHER INCOME (EXPENSES):
Translation adjustment ( 2,252) 64,126 ( 1,109) 2,119
------ ------ ------- ------
Total other income (expenses) ( 2,252) 64,126 1,109 2,119
------ ------ ------- ------
NET (LOSS) (404,206) (267,208) (125,011) (139,614)
======= ======= ======= =======
</TABLE>
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<PAGE>
AMERICANA GOLD & DIAMOND HOLDINGS, INC. & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(UNAUDITED)
(Expressed in U.S. dollars)
<TABLE>
<CAPTION>
Total
Capital Stockholders'
Stock Deficit Equity
----- ------- ------
<S> <C> <C> <C>
BALANCE as of December 31, 1995 9,488,886 (3,436,596) 6,052,290
Capital Stock Increase (2,902,572 Common Stock) 1,655,954 0 1,655,954
PREFERRED STOCK TO COMMON STOCK CONVERSION:
(Increase in Common Stock: 800,000 Common Shares) 500,000 0 500,000
(Reduction in Preferred Stock: 500 Preferred Shares) ( 500,000) 0 ( 500,000)
Net Loss 0 ( 503,062) ( 503,062)
---------- --------- ---------
BALANCE as of December 31, 1996 11,144,840 (3,939,658) 7,205,182
Capital Stock Increase (609,952 Common Shares) 285,989 0 285,989
Deduct Treasury Stock (20,000 Shares at cost) 0 0 ( 25,971)
Net Loss 0 ( 404,206) ( 404,206)
---------- ---------- ----------
BALANCE as of September 30, 1997 11,430,829 (4,343,864) 7,060,994
========== =========== ==========
</TABLE>
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<PAGE>
AMERICANA GOLD & DIAMOND HOLDINGS, INC. & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE PERIOD ENDED SEPTEMBER 30, 1997 AND 1996
(UNAUDITED)
(Expressed in U.S. dollars)
NINE MONTHS ENDED SEPTEMBER 30,
-------------------------------
1997 1996
---- ----
CASH FLOWS (USED IN)
OPERATING ACTIVITIES:
Net (Loss) (404,206) (267,208)
Adjustments to reconcile net loss with
net cash used in operations -
Depreciation 43,983 42,274
Traslation adjustment 2,252 ( 64,126)
Provision for employee severance benefits 9,829 0
Other 0 0
-------- -------
(348,142) (289,060)
NET CHANGES IN OPERATING ASSETS-
AND LIABILITIES:
(Increase) in prepaid expenses
and other current assets ( 18,028) 27,167
Increase (Decrease) in accrued liabilities ( 8,490) ( 49,415)
Increase (Decrease) accounts payable 137,241 (542,138)
Payment of employee severance benefits ( 3,945) ( 2,766)
------- -------
Net cash used in operating activities (241,364) (856,212)
------- -------
CASH FLOW USED IN INVESTING ACTIVITIES:
Purchase of fixed assets 0 (27,101)
Increase in mining concessions (183,889) (246,122)
Treasury Stock ( 25,971) 0
Increase (Decrease) in other assets 646 ( 7,125)
------- -------
Net cash used in investing activities (209,214) (280,348)
------- -------
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:
(Decrease) in long-term accounts payable (862) ( 2,684)
(Decrease) Increase in bank loans 47,219 9,355
Increase in capital stock 285,989 1,026,377
---------- ---------
Net cash provided by financing activities 332,346 1,033,048
---------- ---------
EFFECT OF EXCHANGE RATE FLUCTUATION ON CASH ( 2,252) 64,126
---------- ---------
(DECREASE) INCREASE IN CASH ( 120,484) (39,386)
CASH & CASH EQUIVALENT AT BEGINNING OF PERIOD 133,280 44,169
--------- ---------
CASH & CASH EQUIVALENT AT END OF PERIOD 12,796 4,783
========= =========
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<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Overview
The Company has only recently begun its business activities and
accordingly has generated limited revenues. The Company had generated an
accumulated deficit of $4,343,864 through September 30, 1997, due to its
significant research, development, administrative and exploration expenses and
insufficient revenues in relation to its operating expenses. For the nine months
ended September 30, 1997 the Company had no revenues. Management believes that
the Company will continue to have limited or no revenues and that losses will
continue to be incurred until it is able to successfully acquire or place a
property in operation. There can be no assurance that Management will be
successful in accomplishing this task. The independent auditor's report for the
fiscal year ended December 31, 1996 has been prepared on the basis that the
Company will continue as a going concern.
Results of Operations
Quarter ended September 30, 1997 compared to Quarter ended September
30, 1996.
There was no income for the quarter ended September 30, 1997
compared to income of $ 2,119 for the quarter ended September 30, 1996. For the
nine months ended September 30, 1997 there was no income compared to income of
$64,126 for the nine months ended September 30, 1996. For the three and nine
months ended September 30, 1996 the Company's income was primarily attributable
to foreign currency exchange gain.
Administrative expenses were $123,902, for the quarter ended
September 30, 1997 compared to $141,733 for the quarter ended September 30,
1996, and $404,206 for the nine months ended September 30, 1997 compared to
$331,334 for the nine months ended September 30, 1996.
Due to the lack of income and the increase in administrative
expenses, the net loss for the quarter ended September 30, 1997 decreased to
$125,011 as compared to a net loss of $139,614 for the quarter ended September
30, 1996, and for the nine months ended September 30, 1997 the net loss
increased to $ 404,206 as compared to a net loss of $267,208 for the nine months
ended September 30, 1996.
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<PAGE>
Changes in Financial Condition - From December 31, 1996 to September 30, 1997.
The Company's Assets increased from $10,372,186 for the year ended
December 31, 1996 to $10,408,990 due primarily to investments made for the
drilling in La Fortuna I Concession.
Liquidity and Capital Resources
The Company had $285,989 in working capital as of September 30,
1997, compared with working capital of $293,266 as of September 30, 1996.
The change in working capital was primarily due to the receipt of
proceeds from the foreign private placement offering described below offset by
funding of operations and the Company's investments in the La Fortuna and
Bochinche concessions.
At September 30, 1997, the Company had a note payable to a bank
outstanding in the amount of $170,000. The loan bears interest at 6% per annum
and matures on February 2, 1998. The Company's subsidiaries had two notes
payable to a Venezuelan Bank for the total equivalent amount of $ 47,219. These
loans bear interest at 33% per annum and mature on September 30, 1998. Long-term
debt of the Company relating to liabilities assumed by the Company for the
purchase of exploration and exploitation rights of mining concessions currently
amounts to $2,959,389. Such amount relates to approximately $390,000 in payments
due on the Fortuna I Concession, and the balance relates to the El Progreso
Concession, which the Company is currently renegotiating. There can be no
assurance that the Company will be successful in such renegotiations.
In late 1995 and January 1996 the Company raised approximately
$350,000 from a foreign private placement of 35 Units, each unit consisting of a
convertible $ 10,000 principal amount promissory note. The note was due and
payable on July 19, 1996 and bore interest at 8%. In March 1996 the purchasers
of the 35 units of the private placement elected to convert their notes into an
aggregate of 700,000 shares of the Company's Common Stock.
During 1996 the Company raised aproximately $ 677,843 from two
foreign private placements of Common Stock to investors who reside outside the
United States, including officers and directors of the Company. The Company
issued 1,250,000 shares of Common Stock in connection with these private
placements.
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<PAGE>
During the nine months ended September 30,1997 the Company raised
approximately $ 285,989 from a foreign Private Placement of Common Stock to
investors who reside outside the United States. The Company issued 609,952
shares of Common Stock in connection with this Private Placement.
The Company will continue to rely upon Management until additional
sources of financing are secured or a suitable property is acquired with
sufficient cash flow to sustain the Company. There can be no assurance that the
Company will in fact secure additional financing or have sufficient cash flow
from operations.
Forward Looking Statements
This Form 10-QSB contains certain 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, amended. Investors are
cautioned that all forward looking statements involve risks and uncertainty,
including without limitation, the viability of gold mines, exploration costs,
foreign currency exchange rates and general market conditions. Although the
Company believes the assumptions underlying the forward-looking statements
contained herein are reasonable, any of the assumptions could be inaccurate, and
therefore, there can be no assurance that the forward-looking statements
contained in the report will prove to be accurate.
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<PAGE>
PART II - OTHER INFORMATION
- -----------------------------
Item 1. Legal Proccedings
Not applicable.
Item 2. Changes in Securities
As described under "Management's Discussion and Analysis or Plan of
Operation - Liquidity and Capital Resources" the Company has raised
approximately $ 285,989 from a foreign private placement whereby the
Company has issued 609,952 shares of Common Stock. Of such amount,
$68,889 was raised in the three months ended September 30, 1997 and
the Company issued 101,710 shares in the three months ended
September 30, 1997. There were no underwriting discounts or
commissions paid in connection with this issuance and the Company
sold such securities pursuant to Section 4(2) of the Securities Act
of 1933, as amended.
Item 3. Default Upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not appicable.
Item 5. Other Information.
Current Events
During the third quarter of 1997, augering and trenching
activities were taken out on La fortuna I Concession. A total
of 294 meters of augering was completed and 103 samples were
analysed for gold. From the trenching in the N.W. Zone a total
of 60 samples were analysed for gold.
The augering in the Central Zone showed the presence of a
large area with a good potential for surface mining.
The augering and trenching in the N.W. Zone confirms that the
Zone continues to be of significant interest. The area arround
Trench T-27A continues to be the best in the N.W. Zone.
Additional work in the form of trenches and augering, prior to
drilling should be undertaken.
Item 6. Exhibits and reports on Form 8-K.
a) Exhibits - None.
b) Reports on Form 8-K - None.
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<PAGE>
S I G N A T U R E S
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to the signed on its behalf by the
undersigned thereunto duly authorized.
Date: November 11, 1997
/s/ Henry Bloch
-----------------------
Henry Bloch
Chief Financial Officer
-11-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This Schedule contains summary financial information extracted from the
Consolidated Financial Statements as of September 30, 1997 and is qualified in
its entirety by reference to each Financial Statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 13
<SECURITIES> 0
<RECEIVABLES> 59
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 72
<PP&E> 10,591
<DEPRECIATION> 253
<TOTAL-ASSETS> 10,410
<CURRENT-LIABILITIES> 389
<BONDS> 2,960
0
25
<COMMON> 11,406
<OTHER-SE> (3,966)
<TOTAL-LIABILITY-AND-EQUITY> 10,814
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 404
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (404)
<DISCONTINUED> 0
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<CHANGES> 0
<NET-INCOME> (404)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
