<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
/X/ Quarterly Report pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
FOR THE QUARTER ENDED DECEMBER 31, 1995
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 No. 0-15474
AMERALIA, INC.
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(Exact name of Company as specified in its charter)
1155 KELLY JOHNSON BLVD., COLORADO SPRINGS, CO 80920
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(Address of Principal Executive Offices)
(719) 260 6011
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(Company's telephone number, including area code)
A Utah Corporation
I.R.S. Employer Identification No. 87-0403973
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.
The number of shares outstanding of the Company's $.01 par value common stock
as of February 1, 1996 was 2,693,271. Shares of preference stock, $.05 par
value, outstanding as of February 1, 1996: 898,996.
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AMERALIA, INC.
INDEX TO FORM 10-Q
Page
PART I: FINANCIAL INFORMATION ----
Item 1: Financial Statements
Consolidated Balance Sheets -- December 31,
1995 and June 30, 1995 1
Consolidated Statements of Operations for
the Quarters and Half Years ending December 31,
1995 & 1994 3
Consolidated Statements of Cash Flows for
the Half Years ending December 31, 1995 & 1994 4
Notes to Consolidated Financial Statements 5
Item 2: Management's Discussion and Analysis of
Financial Condition and Results of Operations. 6
SIGNATURE 8
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AMERALIA INC
CONSOLIDATED BALANCE SHEETS
Amounts in Thousands of Dollars ($)
<TABLE>
<CAPTION>
Dec 31 June 30
1995 1995
(Unaudited) (Unaudited)
----------- -----------
<S> <C> <C>
ASSETS
Current Assets:
Cash at bank 7 5
Accounts receivable -- 5
Prepayments 37 --
Related party receivables 17 28
Net realizable value of notes
receivable -- current 87 300
Note receivable -- net 139 139
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Total Current Assets: $ 287 $ 477
Non Current Assets:
Lease exploration & development costs 2,149 2,060
Investment in Rural Investment Trust 431 413
Property and equipment 31 35
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Total Assets: $ 2,898 $ 2,985
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</TABLE>
(Continued over page)
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AMERALIA INC
CONSOLIDATED BALANCE SHEETS
Amounts in Thousands of Dollars ($)
<TABLE>
<CAPTION>
Dec 31 June 30
1995 1995
(Unaudited) (Unaudited)
----------- -----------
<S> <C> <C>
LIABILITIES & SHAREHOLDERS' FUNDS
Current liabilities:
Accounts payable 66 261
Due to related parties 11 116
Notes payable -- current portion 812 821
Interest payable 335 341
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Total Current Liabilities $ 1,224 $ 1,539
Other liabilities
Notes payable -- long term 14 14
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Total other liabilities 14 14
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Total Liabilities: $ 1,238 $ 1,553
Commitments and contingent liabilities -- --
SHAREHOLDERS' EQUITY
Preferred stock, US$0.05 par value; 1,000,000
authorized; 718,996 and 718,416 issued at
December 31 and June 30, 1995: 36 36
Common stock, US$.01 par value; 100,000,000
shares authorized; Issued @ Dec 31, 1995 and
@ June 30, 1995: 2,609,759: 26 26
Additional paid in capital 8,524 7,944
Accumulated deficit (7,049) (6,697)
Foreign currency translation adjustment 123 123
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Total Shareholders' Funds: $ 1,660 $ 1,432
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Total Liabilities and Shareholders' Equity: $ 2,898 $ 2,985
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</TABLE>
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AMERALIA INC
CONSOLIDATED STATEMENTS OF OPERATIONS
Amounts in Thousands of Dollars ($)
(Unaudited)
<TABLE>
<CAPTION>
Quarter Quarter Half year Half year
ending ending ending ending
Dec 31 Dec 31 Dec 31 Dec 31
1995 1994 1995 1994
------- ------- --------- ---------
<S> <C> <C> <C> <C>
REVENUES
Interest -- -- -- 11
------- ------- --------- ---------
Total Revenues from operations: $ -- $ -- $ -- $ 11
EXPENSES
General and administrative 168 285 248 408
Depreciation and amortization 3 3 6 7
Interest paid 39 35 72 52
------- ------- --------- ---------
Total Expenses: $ 210 $ 323 $ 326 $ 467
INCOME/(LOSS) from operations $ (210) $ (323) $ (326) $ (456)
Loss on disposal of assets -- -- -- (1)
Foreign currency gain/(loss) (82) 19 (3) 18
------- ------- --------- ---------
NET INCOME/(LOSS) $ (292) $ (304) $ (329) $ (439)
------- ------- --------- ---------
Net loss per share $(0.11) $ (.13) $ (0.13) $ (.18)
Weighted average number of shares ('000) 2,609 2,380 2,609 2,380
</TABLE>
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AMERALIA INC
CONSOLIDATED STATEMENT OF CASH FLOWS
Amounts in Thousands of Dollars ($)
(Unaudited)
<TABLE>
<CAPTION>
Half year Half year
ending ending
Dec 31 Dec 31
1995 1994
--------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ (329) $ (439)
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 6 7
Exchange (gain) loss 3 (18)
(Increase) decrease in:
Accounts receivable 5 5
Prepayments (37) --
Notes receivable 227 95
Related parties receivables 11 (10)
Interest receivable -- (6)
Increase (decrease) in:
Bank overdraft -- 2
Accounts payable (194) (140)
Notes payable -- short-term 25 318
Due to related parties (105) (11)
Interest payable (19) 36
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Net cash used in operating activities (407) (161)
CASH FLOWS FROM INVESTING ACTIVITIES
Lease exploration and development expenditure (89) (97)
Purchase of office equipment (2) --
Cash flows from investing activities (91) (97)
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of preferred stock 580 --
Issuance of common stock -- 159
Receipt of subscriptions receivable -- 78
Dividends paid (23) --
Cash received from loan proceeds -- 145
Cash payments on loans (57) (147)
------ ------
Cash flows from financing activities 500 235
NET INCREASE (DECREASE) IN CASH 2 (23)
Cash at beginning of period 5 23
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Cash at end of period $ 7 $ --
------ ------
------ ------
</TABLE>
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AMERALIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As at December 31 and June 30, 1995
and for the Periods ended December 31, 1995 and 1994
NOTE 1. MANAGEMENT ADJUSTMENTS
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these financial statements
be read in conjunction with the Registrant's June 30, 1995 Annual Report on
Form 10-K. The results of operations for the periods ended December 31, 1995
and 1994 are not necessarily indicative of operating results for the full years.
The Consolidated Financial Statements and other information furnished
herein reflect all adjustments which are, in the opinion of management of the
Registrant, necessary for a fair presentation of the results of the interim
periods covered by this report.
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AMERALIA, INC.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
(Amounts in Dollars, $)
LIQUIDITY AND CAPITAL RESOURCES
In October, 1995 the company received an application for an issue of preferred
stock to the value of $2 million from its major stockholder. The Company
received the first $500,000 of this amount in October and the Company has an
agreement with the stockholder for the receipt of the balance as expenditures
are incurred in drilling a core hole on the Company's Rock School Lease. A
further $180,000 was received in January, 1996 and another $450,000 is expected
in February, 1996. In addition, another $80,000 accompanied an additional
application for preferred stock from another, existing stockholder. These stock
subscriptions have substantially alleviated the Company's liquidity
difficulties and will enable the Company to progress its investment in the Rock
School Lease with the preparation of a comprehensive business plan for the
purpose of seeking funding for the construction of an operating plant.
Effective January 1, 1996 the Company has also received confirmation from the
Bureau of Land Management of its assignment of the Rock School Lease, thereby
finalizing the transfer of the lease ownership to the Company.
In addition, the Company received $187,000 from the partial repayment of its
notes receivable held with an Australian, rural based institution and raised
another $65,000 from the issuance of short term notes payable. Funds were used
to repay accounts payable. Funds were used to repay accounts payable
($194,000), liabilities to related parties ($105,000), notes payable ($57,000)
and to further the Company's investment in the Rock School Lease ($89,000).
Management is continuing its discussions with The THG Partnership, a related
party, which holds a note payable by the Company and believes an agreement on
the settlement of this significant liability will be reached soon. This matter
is discussed more fully in the Company's Annual Report on Form 10K.
Throughout the Company's development, funding requirements have been met
through the Company's capacity to raise funds from additional equity and the
issuance of short term notes payable. Management is presently engaged in
discussions with prospective investors and lending institutions with a view to
raising additional capital, although at the date of this report, these
discussions have not come to fruition. In order to conduct mining operations on
its lease, the Company will require large amounts of
6
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capital, significantly greater than the existing resources of the Company and
there is no assurance that this funding can be obtained.
RESULTS OF OPERATIONS
The Company's loss from operations for the half year was $329,000 compared with
$439,000 for the same period in the previous year. The reduction is due
primarily to a provision made in the prior period in anticipation that the
notes receivable held with Australian institutions might not be fully
recoverable. During the current period a significant recovery was made from
these notes and no further provisions have been made. The Company is now
obliged to pay royalties and consulting fees to E. E. Kinder Co., an
unaffiliated party which was the previous owner of the Rock School Lease.
Together, these payments represent a minimum of $100,000 per year.
The Company's results are affected by movements of the Australian dollar
relative to the United States dollar. However, the net effect of currency
movements throughout the half year has been nearly negligible.
IMPACT OF INFLATION
The Company believes that its activities are not materially affected by
inflation.
EXCHANGE RATE
At December 31, 1995, US$ = A$1.35.
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SIGNATURE
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 thereunto duly authorized.
AMERALIA, INC.
February 19, 1996 By: /s/ Robert van Mourik
------------------------
Robert van Mourik
Executive Vice President, Chief
Financial Officer and principal
financial and accounting officer.
8
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