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 QUARTERLY PERIOD ENDED: June 30, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM N/A TO _______________
Commission File Number: 0-17048
CENTURION MINES CORPORATION
(Exact name of registrant as specified in its charter)
UTAH 87-0429204
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification Number)
331 South Rio Grande, Suite 201, Salt Lake City, Utah 84101
(Address of Principal Executive Offices) (Zip Code)
801-534-1120
Registrant's telephone number, including area code
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 at March 31, 1995: 23,556,471 shares
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS OF CENTURION MINES CORPORATION
(Hereinafter referred to as Registrant or Company)
The condensed, consolidated financial statements of the Registrant
included herein have been prepared by the Registrant from its own
books and records. In the opinion of management, the financial
statements included in this quarterly report present fairly in all
material respects, the financial position of Registrant and
subsidiaries as of June 30, 1995, and September 30, 1994, and
the results of operations and cash flows for each of the three
months ended June 30, 1995, and 1994,in conformance with generally
accepted accounting principles.
As discussed in Item 2, a substantial portion of Registrant's
assets consist of investments in mineral properties for which
additional exploration is required to determine if they contain
ore reserves that are economically recoverable. The realization
of these investments is dependent uponthe success of future
property sales, the existence of economically recoverable reserves,
the ability of the Company to obtain financing or make other
arrangements for development, and upon future profitable
production. Accordingly, no provision for any asset impairment
that may result, in the event the Company is not successful in
developing or selling these properties, has been made in the
accompanying consolidated financial statements.
<PAGE>
CENTURION MINES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
ASSETS As of As of
June September
30, 1995 30, 1994
CURRENT ASSETS:
Cash $ 21,203 $ 710,026
Accounts receivable 187,689 300,000
Advances to related parties 18,766 83,068
Prepaid expenses 83,749 99,674
Marketable securities (Note 3) -- --
Total current assets 311,407 1,192,768
MINERAL PROPERTIES 8,573,620 7,380,822
PROPERTY AND EQUIPMENT:
Leasehold improvements 8,845 2,480
Furniture and equipment 215,530 202,502
Vehicles 100,220 92,027
Field Equipment 303,071 75,543
Less: Accumulated
depreciation and amortization (237,058) (164,388)
Total property and equipment 390,608 208,164
OTHER ASSETS
Deposits 9,116 11,046
Total other assets 1,388,792 --
TOTAL ASSETS $ 9,284,751 $ 8,792,800
<PAGE>
CENTURION MINES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
As of As of
June September
30, 1995 30, 1994
CURRENT LIABILITIES:
Accounts payabl e $ 227,889 $104,697
Accrued compensation payable 118,050 118,050
Payable to related party -- 7,131
Advances from shareholder 33,400 25,719
Short Term Note payable 125,000 __
Total current liabilities 504,339 296,896
MINORITY INTERESTS IN
CONSOLIDATED SUBSIDIARIES 436,566 296,896
SHAREHOLDERS EQUITY:
Common stock - $.01 par
value; 25,000,000 shares
authorized; 23,556,471
and 22,157,921 shares
issued and outstanding,
respectively 235,565 221,579
Additional paid-in capital 16,172,094 14,400,348
Accumulated deficit (8,040,563) (6,358,370)
Receivable related to sale
of common stock (23,250) (23,250)
Total shareholders' equity 8,343,846 8,240,307
TOTAL LIABILITIES AND
SHAREHOLDER'S EQUITY $ 9,284,751 $ 8,792,800
<PAGE>
CENTURION MINES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
June 30, June 30,
1995 1994 1995 1994
REVENUES:
Sales of mineral
properties $ -- $ -- $ -- $ --
Management and
consulting fees -- -- -- --
Total revenues -- -- -- --
OPERATING EXPENSES:
General and
administrative 532,984 483,626 1,446,873 1,774,893
Cost of Properties
Abandoned -- -- 203,092 18,736
Mineral leases 47,178 32,732 116,881 54,443
Depreciation and
amortization 23,543 21,848 72,670 30,330
Total
operating
expenses 603,705 538,206 1,839,516 1,878,402
OTHER INCOME (EXPENSE):
Other income 3,616 11,916 19,015 27,600
Interest expense (1,527) (39) (2,737) (210)
Total other
income 2,089 11,877 16,278 27,390
LOSS FROM OPERATIONS (601,616) (526,329) (1,823,238)(1,851,012)
LOSS FROM DILUTION
OF EQUITY INVESTMENT
IN SUBSIDIARY -- -- -- (40,877)
LOSS BEFORE
MINORITY INTERESTS (601,616) (526,329) (1,823,238)(1,891,889)
MINORITY INTERESTS
IN LOSS (INCOME)
OF CONSOLIDATED
SUBSIDIARIES 74,539 10,741 141,045 210,172
NET LOSS $ (527,077)$ (515,588)$ (1,682,193)$ (1,681,717)
NET LOSS PER
COMMON SHARE: $ (.02) $ (.02) $ (.07)$ (.08)
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING 23,323,000 20,946,000 22,859,000 20,182,000
<PAGE>
CENTURION MINES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Increase (Decrease) in Cash
Nine Months Ended June 30,
1995 1994
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net loss $ (1,682,193) $ (1,681,717)
Adjustments to reconcile
net loss to
net cash used in
operating activities:
Compensation and other
expenses paid through
issuance of common stock 541,034 321,559
Issuance of common stock
to directors and
consultants for compensation
by subsidiary -- 454,300
Depreciation and amortization 72,670 30,330
Minority interests 139,670 99,332
Change in assets and
liabilities:
Accounts receivable 112,311 145,763
Receivable from
related party 64,302 (6,828)
Prepaid expenses 15,925 22,225
Mineral properties (649,861) (2,191,530)
Deposits 1,930 (439,364)
Accounts payable 123,192 65,553
Payable to related
party 7,131 20,873
Accrued compensation
payable -- 134,063
Advances from
shareholders 7,681 --
Cash used in
operating
activities (1,246,208) (3,025,441)
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchase of property
and equipment (255,115) (197,668)
Net cash used
in investing
activities (255,115) (197,668)
CASH FLOWS FROM
FINANCING ACTIVITIES:
Issuance of common
stock for cash 812,500 3,842,500
Net cash provided
by financing
activities 812,500 3,842,500
NET INCREASE
(DECREASE) IN CASH (688,823) 619,391
CASH, BEGINNING OF PERIOD 710,026 275,666
CASH, END OF PERIOD $ 21,203 $ 895,057
<PAGE>
CENTURION MINES CORPORATION
Condensed Consolidated Statements of Cash Flows - Continued
Supplemental disclosure of noncash investing and financing
activities:
During the three months ended June 30, 1995, the Company:
issued 61,600 shares of common stock valued at
$92,595 for services of employees and
contractors.
issued 8,000 shares of common stock valued at
$13,000 for promotional services.
issued notes for purchase of property of $125,000.
<PAGE>
CENTURION MINES CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1995
(1) The condensed consolidated financial statements included
herein have been prepared by the Company, without audit, in
accordance with generally accepted accounting principles for
interim financial information and pursuant to the rules,
regulations and instructions of the Securities and Exchange
Commission pertaining to Form 10-Q and Article 10 of
Regulation S-X. These condensed consolidated financial
statements reflect all adjustments which, in the opinion of
management, are necessary to present fairly the results of
operations for the interim periods presented. All
adjustments are of a normal recurring nature. Certain
information, footnotes and disclosures normally included
in complete financial statements prepared in accordance
with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations,
although the Company believes that the following disclosures
are adequate. It is suggested that these condensed
consolidated financial statements be read in conjunction with
the consolidated financial statements and the notes thereto
included in the Company's annual report on Form 10-K for the
year ended September 30, 1994.
(2) Net loss per common share is based on the weighted
average number of common shares outstanding during
the period.
(3) The Company carries its marketable securities at the
lower of cost or market value:
Consolidated Royal Mines, Inc. COST FMV
$ -0- $4,647,801
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION
Financial Condition, Liquidity and Capital Resources
Since inception on June 21, 1984, the Company has
been engaged in exploration, acquisition, and development
of mineral properties primarily through joint ventures.
The Company's principal capital resources have been acquired
through issuance of common stock, through joint venture
operations, and through sales of various properties. The Company
has primarily relied upon joint venture partners to finance
the on-going costs of holding and developing properties.
At June 30, 1995, current liabilities exceeded current
assets by $192,932, compared to a working capital at September
30, 1994, of $937,171. The Company has no long term debt,
thus all capital received is available for funding the ongoing
operations.
The Company's holding of common stock in its subsidiary,
Consolidated Royal Mines, Inc., is approximately 1,549,267 shares
at June 28, 1995, with a current market price about $3 per share.
The Company's assets consist primarily of cash and interests
in mineral properties. The total assets increased from $8,792,800
on September 30, 1994, to $9,284,751 as of June 30, 1995. The
increase in total assets is primarily due to the issuance of shares
of the Company's stock. The increase in mineral properties is a
result of the net effect from the additional purchases of new
mineral properties as well as the additions to the cost basis of the
present mineral properties.
The Company issued a short term note for the purchase of
real property of $125,000.
During the nine months ended June 30, 1995, the Company's
operations used $1,246,208 of cash as compared to $3,025,441
during the nine months ended June 30, 1994. During the nine
months ended June 30, 1995, cash flows from operations included
the collection of accounts receivable of $390,000 offset by
an increase in a receivable for common stock sold, costs
capitalized to mineral properties of $649,861 and an increase
in investments and the Company's current cash operating loss.
These condensed consolidated financial statements include
the following companies, with the state of incorporation and
percentage of ownership as shown: Centurion Mines Corporation,
Utah, 100%; Centurion Exploration, Incorporated, Utah, 100%;
Mazama Gold Corporation, Washington, 100%; Jefferson-Pacific
Corp., Washington, 100%, Dotson Exploration Company,
Nevada, 100%; Mammoth Mining Company, Nevada, 81.3%; Consolidated
Royal Mines, Incorporated, Utah, 65%; and The Gold Chain Mining
Company, Utah, 48.8%.
The Company does not have sufficient capital to fully
explore and develop its mineral properties, nor does the
Company currently have continuing revenues. The Company plans
to continue financing its exploration activities through joint
ventures, equity funding, or by selling properties and retaining
royalty interests. In addition, the Company expects to receive
royalties from properties sold during the fiscal year ended
September 30, 1992, which are currently under exploration and
development by larger mining companies. Management of the Company
expects that the Company's minimum cash expenditures for the next
year can be funded from current working capital and the sales of
some of its equity position in a subsidiary. If required, the
Company will reduce the level of its expenditures to match its cash
flow position.
Results of Operations
Pursuant to the Company's established program of evaluation of
the potential value of its properties and the probability of
recovery of its investments, management decided to discontinue
operations in the Mazama, Washington area. All properties
have been released to their previous owners, principally the
U.S. federal government, but the Company has retained the
technical information relative to the properties. Because
all property interests have been terminated, all costs of
acquisition, exploration, and development of the properties in
Mazama were written off in the prior quarter. This is shown as
cost of properties abandoned, in the amount of $203,092, through
the Company's 100% owned Mazama Gold Corporation subsidiary.
Including the write off of the Mazama properties, the Company
had a loss for the nine months ended June 30, 1995, of
$1,682,193 or $0.07 per share compared with a loss for the
nine months ended June 30, 1994, of $1,681,717 or $0.08
per share. Excluding the write off in the prior quarter
leaves a loss of $1,479,101 or $0.06 per share. This major
improvement is generally the result of efforts at cost
reduction, as explained below.
There was no revenue for either quarter ended June 30; and
other income, principally interest earned on cash in banks,
decreased about $8,000. General and administrative costs
increased by $49,000 to $532,984 in the quarter ended June
30, 1995. Accounting and audit expenses decreased by
$50,000, primarily due to having fewer filings requiring
independent review. This and other cost reductions were
offset by the write off in the current quarter of $52,000
of costs related to the efforts to acquire the Montanore
project discussed in previous reports, and the recognition
of $93,000 of loss on the sale of certain security investments.
Management is unable to assess the impact that these efforts
at cost reductions may have on the operations. Management
believes there is no known certainty nor uncertainty that
such reductions may result in adverse consequences to the
Company's financial condition.
These improvements allowed the Company to concentrate use
of its funds in the areas of land acquisition and exploration,
and in the rehabilitation of tunnels and water systems in
certain previously-producing mines. Also, the Company
invested additional funds in equipment for exploration and
analysis of exploration data. These equipment acquisitions
will allow the Company to continue its efforts to move toward
use of Company personnel instead of outside contractors.
Increases in lease expense for leased property and increases in
depreciation for the additional equipment partly offset the
decreases in operating expenses discussed above.
<PAGE>
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.
The Registrant held the 1995 Annual Shareholders Meeting on
April 19, 1995. Shareholders voted on four matters. First,
they elected as directors Spenst Hansen (20,346,402 for;
313,652 against), Orson Mabey, III, (20,340,952 for; 319,102
against), J.D.H. Morgan (20,293,502 for; 366,553 against)
and Mark D. Dotson (20,268,668 for; 391,386 against). Second,
they ratified the appointment of Jones, Jensen and Company as
Registrant's independent auditors for the current fiscal
year (20,277,817 votes for; 157,717 against and 224, 520
abstentions). Third, shareholders approved an amendment to
the Articles of Incorporation increasing the number of
authorized shares from 25 million to 30 million (19,309,897
for; 1,136,829 against and 213,328 abstentions). Fourth,
shareholders approved an amendment to allow for the issuance
of 500,000 additional shares under the company's 1991 Stock
Option and Stock Award Plan (19,169,933 for; 1,247,693 against
and 242,428 abstentions).
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
None.
<PAGE>
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 thereunto duly authorized.
CENTURION MINES CORPORATION
By Its Chief Executive Officer :
Dated: August 14, 1995 /s/ Spenst Hansen
BY: Spenst Hansen, President
Chief Executive Officer
By Its Principal Financial and Accounting Officer :
Dated: August 14, 1995 /s/ Randy Sutherland
BY: Randy Sutherland, Treasurer/
Assistant Secretary
Principal Financial and
Accounting Officer
