<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 quarterly period ended
JUNE 30, 1996
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 000-19182
---------
Nord Pacific Limited
- ------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Bermuda Not Applicable
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
22 Church St.
Hamilton HM11 Bermuda N/A
- --------------------- ----------
(Address of principal executive officers) (Zip Code)
Registrant's telephone number, including area code (441) 292-2363
Not Applicable
- ------------------------------------------------------------------------------
(Former name, former address, and former fiscal
year, if changed since last report)
Indicated 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 twelve 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 of Common Stock outstanding as of August 9, 1996 was
47,492,270.
<PAGE>
NORD PACIFIC LIMITED
INDEX
Page
Number
------
PART I. FINANCIAL INFORMATION:
ITEM 1. Condensed Consolidated Financial Statements:
Balance Sheets - June 30, 1996
and December 31, 1995 2-3
Statements of Operations - Quarters
ended June 30, 1996 and 1995 and
Two Quarters ended June 30, 1996
and 1995 4
Statements of Cash Flows - Two
Quarters ended June 30, 1996 and
1995 5
Notes to Condensed Consolidated Financial
Statements 6-10
Independent Accountants' Report 11
ITEM 2. Management's Discussion and Analysis
of Financial Condition and Results of
Operations 12-13
PART II. OTHER INFORMATION:
ITEM 1-3. Not Applicable 14
ITEM 4. Submission of Matters to a Vote of Security
Holders 14
ITEM 5. Not Applicable 14
ITEM 6. Exhibits and Reports on Form 8-K 14
1
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NORD PACIFIC LIMITED
BALANCE SHEETS
ASSETS
(In Thousands of U.S. Dollars)
JUNE 30, DECEMBER 31,
1996 1995
------- ------------
CURRENT ASSETS:
Cash and cash equivalents $ 168 $ 3,656
Accounts receivable:
Trade 1,144 1,172
Affiliates 24 40
Other 20 49
------- -------
1,188 1,261
Inventories:
Copper 123 88
Supplies 180 183
------- -------
303 271
Forward currency exchange contracts 596 1,022
Premium on copper contracts 2,622 348
Prepaid expenses 65 172
------- -------
TOTAL CURRENT ASSETS 4,942 6,730
RESTRICTED CASH 1,000 1,080
PREMIUM ON COPPER CONTRACTS 1,081 960
DEFERRED COSTS ASSOCIATED WITH ORE UNDER
LEACH, net of accumulated amortization
of $6,924 in 1996 and $5,867 in 1995 6,091 5,606
PROPERTY, PLANT AND EQUIPMENT -
at cost less accumulated depreciation 5,762 5,919
DEFERRED EXPLORATION AND DEVELOPMENT COSTS:
Girilambone, net of accumulated
amortization of $958 in 1996
and $799 in 1995 1,294 1,356
Other projects 17,874 12,956
OTHER 0 59
------- -------
$38,044 $34,666
------- -------
------- -------
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
2
<PAGE>
NORD PACIFIC LIMITED
BALANCE SHEETS
LIABILITIES AND
SHAREHOLDERS' EQUITY
(In Thousands of U.S. Dollars)
JUNE 30, DECEMBER 31,
1996 1995
-------- ------------
CURRENT LIABILITIES:
Accounts payable:
Trade $ 2,431 $ 1,613
Affiliates 189 32
------- -------
2,620 1,645
Accrued expenses 686 822
Deferred gain on copper contracts 2,678 393
Current maturities of long-term debt 3,495 3,930
------- -------
TOTAL CURRENT LIABILITIES 9,479 6,790
LONG-TERM LIABILITIES:
Long-term debt 750 1,500
Deferred gain on copper contracts 1,357 883
Deferred income tax liability 1,955 1,120
Obligation under purchase agreement 788 744
Retirement benefits 175 169
------- -------
5,025 4,416
SHAREHOLDERS' EQUITY:
Common Stock 475 475
Additional paid-in capital 31,361 31,336
Deficit (9,094) (9,149)
Foreign currency translation adjustment 798 798
------- -------
23,540 23,460
------- -------
$38,044 $34,666
------- -------
------- -------
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
3
<PAGE>
NORD PACIFIC LIMITED
STATEMENTS OF OPERATIONS
(In Thousands of U.S. Dollars, except share and per share amounts)
<TABLE>
<CAPTION>
QUARTER ENDED TWO QUARTERS ENDED
JUNE 30, JUNE 30,
------------------------ ------------------------
(Unaudited-not (Unaudited-not
covered by covered by
accountants' accountants'
report) report)
1996 1995 1996 1995
------- ------- ------- ----------
<S> <C> <C> <C> <C>
SALES $ 3,869 $ 4,528 $ 7,079 $ 7,576
COSTS AND EXPENSES:
Cost of sales 2,293 2,352 4,254 4,145
Abandoned projects 12 0 113 0
General and administrative 870 717 1,768 1,464
------- ------- ------- -------
TOTAL COSTS AND EXPENSES 3,175 3,069 6,135 5,609
------- ------- ------- -------
OPERATING EARNINGS 694 1,459 944 1,967
OTHER INCOME (EXPENSE):
Interest and other income 31 135 96 277
Interest and debt issuance costs (100) (178) (242) (370)
Forward currency exchange contracts
gain (loss) (5) (90) 379 (888)
Copper contracts gain (loss) 36 0 (265) 0
Foreign currency transaction gain
(loss) 21 (136) (22) (486)
------- ------- ------- -------
TOTAL OTHER INCOME (EXPENSE) (17) (269) (54) (1,467)
------- ------- ------- -------
EARNINGS BEFORE INCOME TAXES 677 1,190 890 500
PROVISION FOR INCOME TAXES 535 94 835 94
------- ------- ------- -------
NET EARNINGS $ 142 $ 1,096 $ 55 $ 406
------- ------- ------- -------
------- ------- ------- -------
NET EARNINGS PER COMMON
AND COMMON EQUIVALENT SHARE $ - $ .02 $ - $ .01
------- ------- ------- -------
------- ------- ------- -------
AVERAGE COMMON AND COMMON
EQUIVALENT SHARES (In thousands) 51,227 47,751 49,880 47,748
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
4
<PAGE>
NORD PACIFIC LIMITED
STATEMENTS OF CASH FLOWS
(In Thousands of U.S. Dollars)
<TABLE>
<CAPTION>
TWO QUARTERS ENDED JUNE 30,
------------------------------
(Unaudited-not
covered by
accountants'
report)
1996 1995
-------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings adjusted for non-cash items
except depreciation and amortization $ 2,747 $ 1,477
Depreciation and amortization 1,980 2,202
-------- --------
Net cash provided by operating activities 4,727 3,679
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (548) (614)
Deferred exploration and development costs (5,128) (1,576)
Deferred costs associated with ore under leach (1,542) (1,790)
-------- --------
Net cash (used in) investing activities (7,218) (3,980)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments of long-term debt (1,185) (2,547)
Dividend paid (468)
Stock option activity 25
Restricted cash 80 24
-------- --------
Net cash (used in) financing activities (1,080) (2,991)
EFFECT OF EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS 83 (507)
-------- --------
(DECREASE) IN CASH AND CASH
EQUIVALENTS (3,488) (3,799)
CASH AND CASH EQUIVALENTS -
beginning of period 3,656 7,149
-------- --------
CASH AND CASH EQUIVALENTS - end of period $ 168 $ 3,350
-------- --------
-------- --------
</TABLE>
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
5
<PAGE>
NORD PACIFIC LIMITED
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
QUARTERS ENDED JUNE 30, 1996 AND 1995
A. FINANCIAL STATEMENTS
The balance sheet at December 31, 1995 contains financial information
taken from the audited consolidated financial statements. The interim
consolidated financial statements are unaudited. In the opinion of
management, all adjustments, which consist of normal recurring
adjustments, necessary to present fairly the financial position and
results of operations for the interim periods presented have been
made. The results shown for the first two quarters of 1996 are not
necessarily indicative of the results that may be expected for the
entire year.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been omitted. It is suggested that these
financial statements be read in conjunction with the financial
statements and notes thereto included in the Company's Annual Report
on Form 10-K for the year ended December 31, 1995.
The Company has adopted Statement of Financial Accounting Standards
("SFAS") No. 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets To Be Disposed Of," which requires review
for impairment of long-lived assets whenever changes in circumstances
indicate that the carrying amount of the asset may not be recoverable.
The adoption of SFAS No. 121 has had no effect on the financial
statements for the period ended June 30, 1996.
In October 1995, the Financial Accounting Standards Board issued SFAS
No. 123, "Accounting for Stock-Based Compensation," which is effective
for the Company beginning January 1, 1996. SFAS No. 123 requires
expanded disclosures of stock-based compensation arrangements with
employees and encourages (but does not require) compensation cost to
be measured based on the fair value of the equity instrument awarded.
Companies are permitted, however, to continue to apply APB Opinion No.
25, which recognizes compensation cost based on the intrinsic value of
the equity instrument awarded. The Company will continue to apply APB
Opinion No. 25 to its stock based compensation awards to employees and
will disclose the required pro forma effect on net income and earnings
per share in its year end financial statements as required by SFAS No.
123.
Certain reclassifications have been made in the 1995 financial
statements to conform to the classification used in 1996. These
reclassifications had no effect on results of operations or
shareholders' equity as previously reported.
B. TAXATION
Under current Bermuda law, the Company is not required to pay any
taxes in Bermuda on either income or capital gains. The Company has
received an undertaking from the Minister of Finance in Bermuda that
in the event of any such taxes being imposed, the Company will be
exempted from taxation until the year 2016. Although the Company is
not subject to income taxes, it has subsidiaries which are subject to
income taxes in their respective foreign countries.
6
<PAGE>
A provision for deferred income taxes of $835,000 has been recorded in
the first two quarters of 1996 resulting from the profitable
operations of the Girilambone Copper Property in Australia. The
effective tax rate differs from the statutory tax rate primarily
because losses in other countries cannot be used to offset taxable
earnings in Australia.
C. GIRILAMBONE
The Company is a 40% joint venturer in the Girilambone Copper Property
("Girilambone") in Australia. All costs incurred during mine
development have been capitalized and are being amortized using the
units of production method over the estimated reserves. Following is
summarized balance sheet information of 100% of Girilambone:
JUNE 30, DECEMBER 31,
1996 1995
------- -----------
Current assets $ 3,149 $ 817
Deferred costs associated with ore under leach, net 15,228 14,015
Property, plant and equipment, net 13,096 13,651
Deferred exploration and development costs, net 7,082 7,386
------- -------
Total assets 38,555 35,869
Current liabilities 4,784 2,437
------- -------
Partners' equity $33,771 $33,432
------- -------
------- -------
Company's share of equity (40%) $13,508 $13,373
Less: Eliminations (1,539) (1,599)
------- -------
Net assets recorded by Company $11,969 $11,774
------- -------
------- -------
Debt incurred for the development and construction of Girilambone is
the separate responsibility of each venturer and is not included in
the joint venture's financial statements. At June 30, 1996,
$4,245,000 remains outstanding from borrowings by the Company for the
construction and development of the Girilambone mine and additional
exploration.
7
<PAGE>
Copper production is distributed to each venturer based on its
respective ownership interest. Sale of copper is the responsibility
of each venturer. Cost and expense information related to operation
of the mine is as follows:
<TABLE>
<CAPTION>
QUARTER ENDED TWO QUARTERS ENDED
JUNE 30, JUNE 30,
-------------- ------------------
1996 1995 1996 1995
------- ------- -------- -------
(In Thousands of U.S. Dollars)
<S> <C> <C> <C> <C>
Cost of copper sales $ 5,733 $ 5,881 $ 10,635 $ 10,364
General and administrative expense $ 65 $ 63 $ 128 $ 134
</TABLE>
D. LONG-TERM DEBT
The Company has $4,245,000 outstanding at June 30, 1996, under a
financing agreement to fund its share of the development and
construction of Girilambone and additional exploration. The interest
rate at June 30, 1996 was 7.44% (LIBOR plus 1.85%). The lender has
agreed to defer the June 30, 1996 principal payment of $1,185,000 until
September 30, 1996. The Company is also proceeding with discussions with
the lender to provide additional financing for working capital, including
payment of current maturities of long-term debt, and to fund further
exploration activity.
During the period the loan is outstanding, the Company is required to
maintain a reserve account with the lender. All cash proceeds
generated from Girilambone operations are required to be deposited
with the lender, and must be used to pay any project costs, bank fees,
interest, principal, and funding required in the reserve account
before any cash is available to the Company.
During August 1996, the Company received a $1,575,000 (A$2,000,000)
overdraft facility offer from an Australian lender. The facility,
which is denominated in Australian dollars, is to be repaid by January
31, 1997. Interest is payable monthly in arrears at the lender's
benchmark rate for commercial accounts plus 1%, currently 12.25% per
annum. Final documentation relating to this overdraft facility is in
process and is expected to be completed in August.
E. FINANCIAL INSTRUMENTS
The Company utilizes certain financial instruments, primarily copper
hedging contracts, which are utilized to reduce the risk associated
with the volatility of commodity prices. The Company does not hold or
issue financial instruments for trading purposes.
8
<PAGE>
COPPER CONTRACTS
The Company has entered into combination swap (the "floor price
contracts") and call option contracts to establish a minimum price in
connection with the sale of its share of copper produced from Girilambone
through December 1997. The contracts will enable the Company to realize
(1) a minimum copper price of $1.10 per pound in 1996 and $1.02 per pound
in 1997 (utilizing floor price contracts) plus (2) the excess, if any, of
the market price of copper (as determined by the London Metals Exchange)
over $1.19 per pound in 1996 and $1.11 per pound in 1997 (utilizing option
contracts).
The contracts are for a total of 19.8 million pounds of copper and
settle ratably each month through December 1997. Under floor price
contracts, for an amount of copper equal to the Company's share of
expected monthly sales from Girilambone, gains or losses are deferred and
recognized in sales as each contract settles. Sales for the two quarters
ended June 30, 1996 and June 30, 1995 include $50,000 and $449,000 of
losses, respectively, realized in settlement of the floor price contracts.
At June 30, 1996, the balance sheet includes a premium on copper contracts
of $3,703,000 which represents the amount which the Company would receive
under the floor price contracts and call option contracts if they were all
settled at that date. Also included on the balance sheet in deferred gain
on copper contracts is $4,035,000 which represents the excess of current
market value at June 30, 1996, over the original market value for each of
the contracts.
To the extent that the number of pounds of copper contained in each
floor price contract presently exceeds the Company's share of expected
copper sales from Girilambone, gains and losses on this portion of the
floor price contracts are included in operations each period. Gains or
losses under the call option contracts are included in operations based
on the fair market value of each contract.
The Company is exposed to copper price fluctuations in the event of
nonperformance by the counterparties to the various agreements described
above but has no off- balance sheet risk of accounting loss. The Company
anticipates, however, that the counterparties will be able to fully satisfy
their obligations under the agreements. The Company does not obtain
collateral or other security to support financial instruments subject to
credit risk.
FORWARD CURRENCY EXCHANGE CONTRACTS
The Company entered into forward currency exchange contracts, which
expired in July 1996, to hedge against potential Australian currency
fluctuations related to payment of a portion of the expected operating
costs of Girilambone. Realized and unrealized gains and losses on these
contracts are included in the results of operations.
9
<PAGE>
F. AMERICAN DEPOSITARY RECEIPTS ("ADRS")
The Company has established a program whereby The Bank of New York has
issued American Depositary Receipts ("ADRs") in exchange for the
ordinary shares of the Company's common stock. The exchange ratio is
five ordinary shares for each ADR. The ADRs commenced trading on the
NASDAQ National Market System on August 7, 1995. Effective September
25, 1995, the Company's ordinary shares were no longer traded on
NASDAQ. The Company's ordinary shares continue to be listed and
traded on the Australian Stock Exchange. Holders of ordinary shares
and holders of ADRs can freely convert back and forth between both
securities upon payment of a fee to The Bank of New York and
presentation of appropriate documentation. Per share information
converted to equivalent ADRs is as follows:
<TABLE>
<CAPTION>
Supplemental Information Earnings Per ADR
Quarter Ended Two Quarters Ended
June 30, June 30,
---------------- ------------------
1996 1995 1996 1995
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net earnings per ADR $ .01 $ .11 $ .01 $ .04
Average equivalent ADRs 10,245 9,550 9,976 9,550
(000's) (Assuming full
conversion of ordinary
shares to ADRs)
</TABLE>
10
<PAGE>
INDEPENDENT ACCOUNTANTS' REPORT
Board of Directors and Shareholders
Nord Pacific Limited
We have reviewed the accompanying condensed consolidated balance
sheet of Nord Pacific Limited and subsidiaries as of June 30, 1996, the
related condensed consolidated statements of operations for the three-month
and six-month periods ended June 30, 1996, and the related condensed
consolidated statement of cash flows for the six-month period ended June 30,
1996. These financial statements are the responsibility of the Company's
management.
We conducted our review in accordance with standards established by
the American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and of making inquiries of persons responsible for
financial and accounting matters. It is substantially less in scope than an
audit conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications
that should be made to such condensed consolidated financial statements for
them to be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the consolidated balance sheet of Nord Pacific Limited
and subsidiaries as of December 31, 1995, and the related consolidated
statements of operations, shareholders' equity, and cash flows for the year
then ended (not presented herein); and in our report dated March 11, 1996, we
expressed an unqualified opinion on those consolidated financial statements.
In our opinion, the information set forth in the accompanying condensed
balance sheet as of December 31, 1995 is fairly stated, in all material
respects, in relation to the consolidated balance sheet from which it has
been derived.
DELOITTE & TOUCHE
Chartered Accounts
Hamilton, Bermuda
August 12, 1996
11
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Nord Pacific Limited (the "Company") recorded net earnings for the six months
ended June 30, 1996 of $55,000, compared to net earnings of $406,000 for the
same period of 1995. The Company recorded operating earnings of $944,000 for
the six months ended June 30, 1996, compared to $1,967,000 for the same
period of 1995. The Company's share of copper sold in the first two quarters
of 1996 totaled 6,120,000 pounds, compared to 6,028,000 pounds sold in the
same period in 1995. Copper production increased during the 1996 period due
to completion of production expansion programs during 1995 and early 1996.
Adversely affecting earnings was the decline in the average selling price of
copper to $1.16 per pound during the first two quarters of 1996, a decrease
of $.10 per pound from the first two quarters of 1995. Copper sales for the
first two quarters of 1996 and 1995 include $50,000 and $449,000,
respectively, of losses that were realized in settlement of copper hedging
contracts. Adversely affecting operating earnings in the first quarter of
1996 was the write-off of an abandoned property of $113,000. Also
contributing to lower operating earnings was a 21% increase in general and
administrative expense, which includes general exploration expenditures not
allocable to specific projects. This 21% increase was largely due to the
increase in overall exploration activity and increased administrative costs
associated therewith.
Results of operations during the first two quarters of 1996 include a gain
from forward currency exchange contracts of $379,000 due to the strengthening
of the Australian dollar in relation to the U.S. dollar compared to a loss of
$888,000 in the first two quarters of 1995. A loss of $265,000 was recorded
in the first two quarters of 1996 resulting from marking copper contracts to
market. Foreign currency transaction losses totaled $22,000 and $486,000,
respectively, for the first six months of 1996 and 1995. Interest and other
income decreased to $96,000 in the first two quarters of 1996 from $277,000
in the first two quarters of 1995 due to a decrease in cash available for
investment. Interest and debt issuance costs decreased to $242,000 in the
first two quarters of 1996 from $370,000 in the first two quarters of 1995
due to repayment of debt under the Girilambone financing agreement. A
provision for income taxes of $835,000 was recorded in the first two quarters
of 1996 resulting from profitable operations at Girilambone. A provision for
income taxes of $94,000 was recorded in the same period of 1995 when the
Company benefitted from the use of net operating loss carryforwards which had
previously been subject to a valuation allowance.
The Company recorded net earnings of $142,000 during the second quarter of
1996 compared to net earnings of $1,096,000 for the same period in 1995.
Operating earnings during the second quarter of 1996 totalled $694,000
compared to $1,459,000 during the 1995 second quarter. The Company achieved
record production during the second quarter of 1996, producing 3,432,000
pounds of copper. The primary reason for the decline in operating earnings
during the second quarter of 1996 was the significant decline in copper
selling price. The average copper price decreased to $1.14 per pound during
the 1996 quarter compared to $1.26 in the same period in 1995. Copper sold
in the second quarter of 1996 totalled 3,387,000 pounds compared to 3,598,000
pounds in the second quarter of 1995, a decrease of 6%. Copper sales during
the second quarter of 1996 and 1995 included losses of $50,000 and $231,000,
respectively, from settlement of copper hedging contracts. Results of
operations during the second quarter of 1996 include a provision for income
taxes of $535,000 compared to $94,000 during the second quarter of 1995. A
gain of $36,000 resulted from marking to market the copper contracts in the
second quarter of 1996. The loss on foreign currency exchange contracts was
$5,000 during the second quarter of 1996 compared to $90,000 during the
second quarter of 1995. Interest income decreased in the 1996 second quarter
compared to 1995 due to a smaller cash balance available for investment.
Interest and debt issuance cost decreased due to the reduction in outstanding
debt.
12
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
Cash of $4,727,000 was provided during the two quarters ended June 30, 1996,
by the Companys operating activities. During the first two quarters of
1996, the Company expended cash to fund exploration and development
activity totalling $5,128,000, of which $2,244,000 related to properties near
Girilambone and $2,600,000 related to the Tabar gold project with the
remaining $284,000 expended for other projects. The Company
expended $1,542,000 for its share of deferred costs associated with ore under
leach at Girilambone, and paid $1,185,000 for principal payments under the
Girilambone financing agreement. Cash decreased during the period by
$3,488,000.
The Company is proceeding with exploration activities at the Tabar gold
project and the Tritton copper prospect near Girilambone. A detailed
feasibility study is nearing completion and application has been made for a
mining lease over the Simberi oxide reserves at the Tabar gold project. At
the time a project currently in the exploration stage evolves into
construction and eventual production, significant additional funding will be
required from equity or bank financing.
In August 1996, the Company received a $1,575,000 (A$2,000,000) overdraft
facility offer from an Australian lender. The facility, which is denominated
in Australian dollars, is to be repaid by January 31, 1997. Interest is
payable monthly in arrears at the lender's benchmark rate for commercial
accounts plus 1%, currently 12.25% per annum. Final documentation relating
to this overdraft facility is in process and is expected to be completed in
August. The Company is currently proceeding with discussions with its
primary lender in order to obtain additional financing for working capital
and planned exploration and development of current projects. In addition,
the Company is examining the potential of funding from other sources.
13
<PAGE>
PART II. OTHER INFORMATION
ITEM 1-3. NOT APPLICABLE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual General Meeting of the stockholders was held on
June 4, 1996. The following matters were acted upon and passed
at the meeting:
1. Election of eight Directors.
2. Approval of Granting of Non-Plan Stock Options to Directors
of the Corporation.
3. Appointment of Deloitte & Touche LLP as independent
auditors for 1996.
VOTE TABULATION
BROKER
1. Directors FOR AGAINST ABSTAIN NON-VOTE
--- ------- ------- --------
Edgar F. Cruft 28,313,935 37,000 -- --
W. Pierce Carson 28,221,220 40,960 -- --
Terence H. Lang 28,222,280 37,000 -- --
Leonard L. Lichter 28,220,720 40,960 -- --
John C. R. Collis 28,335,060 37,000 -- --
Michel J. Drew 28,222,680 37,000 -- --
Lucile Lansing 28,213,920 40,960 -- --
John B. Roberts 28,186,720 40,960 -- --
2. Option Grants 26,393,322 1,103,118 -- --
3. Auditors 28,328,650 116,585 -- --
ITEM 5. NOT APPLICABLE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
No Reports on Form 8-K were filed during the quarter ended
June 30, 1996.
EXHIBIT 27. FINANCIAL DATA SCHEDULE - filed herewith as part of
this Report on Form 10-Q.
14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Security Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NORD PACIFIC LIMITED
August 12, 1996 By:s/Terence H. Lang
Terence H. Lang,
Treasurer, Principal
Financial Officer and
Authorized Officer
15
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM NORD PACIFIC
LIMITED FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1996 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 168
<SECURITIES> 0
<RECEIVABLES> 1,144
<ALLOWANCES> 0
<INVENTORY> 303
<CURRENT-ASSETS> 4,942
<PP&E> 9,686
<DEPRECIATION> 3,924
<TOTAL-ASSETS> 38,044
<CURRENT-LIABILITIES> 9,479
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0
0
<COMMON> 475
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<SALES> 7,079
<TOTAL-REVENUES> 7,079
<CGS> 4,254
<TOTAL-COSTS> 6,135
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<INCOME-PRETAX> 890
<INCOME-TAX> 835
<INCOME-CONTINUING> 55
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 55
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
