UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------------
FORM 10-QSB
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly Period ended March 31, 1999
|_| TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Transition Period from _________ to _________
Commission File Number _____________________
IDAHO CONSOLIDATED METALS CORP.
(Exact Name of Small Business Issuer as Specified in its Charter)
British Columbia, Canada 82-0465571
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
504 Main Street, Suite 470
Post Office Box 1124
Lewiston, Idaho 83501
(Address of Principal Executive Offices)
(208) 743-0914
(Issuer's Telephone Number, Including Area Code)
Check whether the issuer has (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or 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 |_| No
|X|
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 12,581,573 as of March 31, 1999.
Transitional Small Business Disclosure Format (check one): Yes |_| No |X|
<PAGE>
IDAHO CONSOLIDATED METALS CORP.
Form 10-QSB
For the Fiscal Quarter ended March 31, 1999
TABLE OF CONTENTS
<TABLE>
Page
PART I
<S> <C>
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS OF THE COMPANY...................................................................3
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.............................................4
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.....................................................................................7
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.............................................................9
ITEM 3. DEFAULTS UPON SENIOR SECURITIES......................................................................11
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS..................................................11
ITEM 5. OTHER INFORMATION....................................................................................11
ITEM 6. EXHIBITS AND REPORTS FILED ON FORM 8-K...............................................................11
SIGNATURES.......................................................................................................12
</TABLE>
Page 2
<PAGE>
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS OF THE COMPANY
The following unaudited financial statements for the period ended 31 March, 1999
are included in response to Item 1 and have been compiled by Staley, Okada,
Chandler & Scott, Chartered Accountants.
The financial statements should be read in conjunction with Management's
Discussion and Analysis or Plan of Operations and other financial information
included elsewhere in this Form 10-QSB.
Page 3
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This Form 10-QSB contains forward-looking statements. A forward looking
statement may contain words such as "will continue to be," "will be," "expect
to," "anticipates that," "to be" or "can impact." Management cautions that
forward-looking statements are subject to risks and uncertainties that could
cause the Company's actual results to differ materially from those projected in
forward-looking statements.
1. Results of Operations
First Quarter 1999 Compared with First Quarter 1998
The Company is in the exploration stage and has yet to generate revenue from
production. The Company continues to explore its mineral properties in an effort
to establish proven ore reserves, and now has the additional resources of a
joint venture partner to assist in this regard.
In the first quarter, general and administrative expenses decreased from
$135,596 to $99,071 compared to the first quarter of 1998, representing a 27%
savings. Significant decreases were experienced in management fees and wages and
shareholder information expenses. On a quarter over quarter basis, the Company
reduced operating expenses by nearly $37,000.
The Company experienced a net loss for the period of $167,805, of which $99,071
was related to general and administrative expenses. The Company had a loss of
$144,107 for the same period in 1998.
During the quarter, the Company expended $102,676 on its resource property
exploration, development and acquisition program as compared to $37,313 in the
comparable 1998 period. The Company expended similar amounts during the period
ended March 31, 1999 on the Company's mining interests located in Idaho, U.S.A.
as in the same period in 1998. During the period ended March 31, 1999, the
Company launched a staking and filing program in Montana, U.S.A.and paid the
related recording fees.
The Company has staked multiple sulfide rich horizons that are anomalous in
platinum and palladium adjacent to the operating Stillwater Mine located in
Stillwater and Sweet Grass counties, Montana. The Company conducted research of
the geology of the area and detailed title research into the land position.
Based on the results of that research, the Company staked two large blocks of
claims. The first contiguous block of 155 claims is located adjacent to the J.M.
Reef. The second zone consists of 119 claims along the Picket Pin Zone.
The Company also negotiated an agreement with Platinum Fox and entered into a
Letter of Intent on 54 claims located near Chrome Mountain, Montana. These
claims are contiguous to claims staked near the Stillwater Mine. The copying,
research and recording costs incurred in the period ended March 31, 1999,
amounted to $80,273 as compared to $0 in the same period in 1998.
Page 4
<PAGE>
2. Liquidity and Capital Resources
The Company is dependent on the proceeds of debt and equity financings,
including but not limited to public offerings, private placements, issuances of
convertible securities and the exercise of stock options or warrants, as well as
from the optioning or sale of its properties and the sale of other assets to
fund its general and administrative expenditures and its mineral exploration and
development costs. Without such proceeds, the Company may not continue as a
going concern. See note 1 to the Company's December 31, 1998 Financial
Statements for additional information. The Company will need further funds to
continue its operations and there is no reasonable assurance that such funding
will be available.
During the quarter ended March 31, 1999, the Company as borrower, entered into
Convertible Loan Agreement #6 with the Tomasovich Family Trust as lender (the
"Trust"), Theodore Tomasovich being both Trustee of the Trust and a Director of
the Company, for $115,000 repayable on or before January 28, 2001 (the "Maturity
Date") bearing interest at 9% per annum. The Trust may require the Company to
convert all or any portion of the principal amount of the loan advanced and then
outstanding into units ("Units") at a conversion price of one Unit for each
C$0.15 of indebtedness until and including January 28, 2000 and at a conversion
price of one Unit for each C$0.20 of indebtedness during the period from January
29, 2000 until the Maturity Date for a maximum of 1,172,847 units if the
principal amount is converted in its entirety by January 28, 2000 and a maximum
of 879,635 units if the principal amount is converted in its entirety between
January 29, 2000 and the Maturity Date. Each Unit consists of one common share
and one non-transferable common share purchase warrant with each warrant being
exercisable at a price of C$0.15 per share until January 28, 2000 and C$0.20 per
share from January 29, 2000 to the Maturity Date. The Convertible Loan Agreement
was accepted by the VSE on February 9, 1999.
Based upon Canadian generally accepted accounting principles, the $115,000
convertible security instrument has been allocated $72,778 to notes payable and
$42,222 to equity based upon the fair value of the equity component. As the
equity component is not detachable, the amount would be recorded as a $115,000
note payable for U.S. generally accepted accounting principles.
During the quarter ended March 31, 1999, the Company closed a non-brokered
private placement ("Private Placement") which resulted in the issue of 2,000,000
units. Each unit consisted of one common share and one non-transferable warrant.
Each warrant entitles the holder to purchase one additional share at a price of
C$0.15 per share in the first year and C$0.18 per share in the second year. The
Vancouver Stock Exchange ("VSE") accepted the Private Placement for filing
effective March 24, 1999, and the shares were issued from treasury on March 29,
1999.
During the quarter ended March 31, 1999, the Trust elected to convert
convertible loans #1 and #2 aggregating $210,000 of the notes issued during 1998
for 1,146,923 units of the Company. Each unit consists of one common share of
the Company's stock and one non-transferable share purchase warrant. The Company
reduced notes payable by $154,946, reduced convertible securities by $27,527 and
increased share capital by $182,473 on conversion of these notes. The remaining
$27,527 of equity remains in convertible securities until the related warrants
are exercised.
Page 5
<PAGE>
The Company anticipates, based on currently proposed plans and assumptions
relating to its operations and exploration activities, that the proceeds of
Convertible Loan Agreement #6 and the Private Placement (without the exercise of
any of the warrants) will not be sufficient to satisfy the Company's
contemplated cash requirements for the following 12 month period. Any proceeds
from the exercise of stock options or warrants will be applied to satisfy the
Company's contemplated cash requirements. The remaining proceeds, if any, will
be added to general working capital purposes or used to reduce current
liabilities.
The Company plans to conduct exploration and development on its various
properties within the constraints of current market conditions, with its
objective being the maximization of geologic understanding of the projects with
minimal expenditures. The Company's estimated budget, for the remainder of 1999,
for all properties is $850,000 including BLM rental fees and contractual
payments to underlying claim owners. The Company intends to conduct an extensive
exploration program on the recently staked and optioned claims located near the
operating Stillwater Mine in Montana. The program will consist of mapping,
sampling, geophysics and drilling by the Fall of 1999. The anticipated budget
for this program is $500,000 and is within the $850,000 budget for the remainder
of fiscal 1999. The remainder of the $850,000 budget will be spent on geologic
mapping, sampling and assays, geologic interpretation, geophysics, geochemical
soil sampling, property payments and claim rental fees. The estimated budget is
exclusive of expenditures by the Company's joint venture partner on the Petsite
property.
The Company requires approximately $200,000 for general and administrative
expenses for the remainder of the fiscal year and approximately $8,000 for
payments on its notes payable. The Company anticipates repayment of these notes
from the proceeds of the Private Placement, the proceeds of convertible debt
issues and the exercise of stock options and warrants.
As at March 31, 1999, the Company has a working capital deficiency of $238,072
versus a working capital deficiency of $427,081 for the same period in 1998.
Accounts payable to related parties accounts for approximately 35% of the
deficiency. The Company anticipates improvement of this deficiency from the
proceeds of private placements and the exercise of stock options and warrants
during 1999.
Positive cash flow from the financing activities of the Company of $315,000 and
$208,999 were recorded during the quarters ended March 31, 1999 and 1998,
respectively. The convertible securities increased to $264,557 at March 31, 1999
from $0 at March 31, 1998. The long-term debt increased to $696,593 at March 31,
1999 from $221,976 in 1998 and current liabilities decreased to $272,804 in 1999
from $609,516 in 1998. Of the March 31, 1999, current liabilities, $172,936
represents the amount due to non related party accounts payable accounts,
$84,079 represents accounts payable amounts due to various related parties, and
$15,789 represents the current portion of notes payable.
Negative cash flows from operating activities of ($195,839) and ($122,487) were
recorded during the quarters ended March 31, 1999 and 1998, respectively. The
Company will continue recording negative cash flow from operating activities
unless significant revenue is generated from ore production. The continued
negative cash flow will have a material negative impact on liquidity.
Investing activities consist of funds being expended on acquisition and
exploration of resource properties. The net cash expended on investing
activities as of March 31 increased to $104,676 in 1999 from $37,313 in 1998.
Page 6
<PAGE>
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
CIVIL SUIT BY GUMPRECHT - PROMISSORY NOTE
During 1997, a lawsuit was brought against the Company, IMD and Mr. Joseph
Swisher by the plaintiffs, Thomas Gumprecht and Bonnie Witrak (the
"Plaintiffs"). The Plaintiffs brought the action to collect on a promissory note
dated October 19, 1995 entered into between the Plaintiffs and the Company in
the amount of $250,000. In connection with the execution of the promissory note,
the Company and Plaintiffs entered into a security agreement, which granted the
Plaintiffs a security interest in certain assets. The Plaintiffs sought
possession of certain assets, which included equipment located at the Eckert's
Hill Mine and Mill site and at the Golden Eagle site. The Plaintiffs sought a
judgment in the total amount of $308,000 for principal and interest up to and
including October 1, 1997.
During 1998, the Company elected to allow a default to be entered in the lawsuit
and the Court ordered the Company to pay the amount of $332,216 (paid) which
included interest through May 17, 1998. The Plaintiffs' claim for attorney fees
was denied by the Court and they have appealed this decision. The Company has
indicated its willingness to attend a settlement conference to conclude this
matter.
CIVIL SUIT BY GUMPRECHT - SHARE EXCHANGE
During 1996, a lawsuit was brought against IMD and Mr. Joseph Swisher, by Thomas
Gumprecht (the "Plaintiff"). During 1997, the Plaintiff filed an Amended
Complaint which added the Company and Delbert and Elli Steiner as defendants
(with IMD and Joseph Swisher, collectively the "Defendants"). The Plaintiff
alleges that the Plaintiff made various loans to Idaho Non-Metallic Mineral, a
company owned in part by Mr. Steiner and Mr. Swisher, in exchange for shares of
Silver Crystal Mines and IMD. The Plaintiff claims that prior to December 1991,
the parties to the lawsuit had an oral agreement to exchange the Plaintiff's
shares in Silver Crystal and IMD for 250,000 of the Company's shares, which were
owned by IMD. The Plaintiff is seeking transfer of such shares. The Defendants
deny that any such oral agreement was made and have raised the statute of frauds
and statute of limitations as defenses to the Plaintiff's claims.
During 1998, the claims for securities fraud and negligent misrepresentation
were dismissed by the Court, on summary judgment. The remaining claims of the
lawsuit are in the discovery phase and a trial date has been set for August 23,
1999. The Company is of the view that the allegations are generally without
merit and will continue to defend such actions vigorously.
CIVIL SUIT BY GUMPRECHT - DERIVATIVE ACTION
Thomas Gumprecht and Kirke White (the "Plaintiffs") filed an Amended Complaint,
Shareholders Direct and Derivative Action in the District Court of the Second
Judicial District of the State of Idaho, in and for the County of Idaho on
August 5, 1997. While the Complaint names the Company as a defendant on several
pages, the Company is not named formally as a party to the Amended Complaint.
The lawsuit makes allegations against Mr. Steiner and names the Company with
respect to the transfer of various funds and alleged agreements between Mr.
Steiner and the Plaintiffs set out more particularly as follows:
Page 7
<PAGE>
The Plaintiffs allege that Mr. Joseph Swisher was involved in the creation of
the Company, an allegation that the Company denies. The Plaintiffs further
allege that the Company paid Silver Crystal $800,000 for the construction of the
Eckert's Hill Mine and Mill site which the Company admits. The Plaintiffs allege
that such funds were diverted for the personal use of Mr. Joseph Swisher, which
the Company denies. These funds were utilized by the Company for an independent
metallurgical evaluation of the entire Swisher-Br Process and for general and
administrative expenditures.
The Plaintiffs alleged that an agreement was made in August of 1995 by IMD to
exchange the Plaintiffs' stock in Silver Crystal for that of the Company owned
by IMD. The Company admits an offer was made to this effect but denies that such
offer was accepted and as a result no agreement was formed.
The Plaintiffs allege that Mr. Steiner solicited funds from the Plaintiffs while
acting as their attorney and deposited such funds into his attorney/client trust
account and/or his attorney general business account. The Plaintiffs allege such
funds were given to Mr. Steiner in exchange for stock in the Company, owned by
IMD, which was not delivered. The Plaintiffs allege that the solicitation of
funds, the depositing of such funds into Mr. Steiner's client accounts, the
disbursement of such funds without accounting, and the failure transfer stock to
the Plaintiffs exhibits negligence by failure to exhibit the care expected of a
reasonably prudent attorney acting in the same or similar circumstances in the
same or similar community. Mr. Steiner specifically denies soliciting funds from
the Plaintiffs and states that the disbursement of such funds was undertaken at
the instruction of the Plaintiff, Mr. Gumprecht. All alleged negligence was
prior to or at the time of the incorporation of the Company and for which the
statute of limitations has run, prior to the date of the filing of the
complaint. Mr. Steiner further denies the remainder of the aforementioned
allegations.
The Plaintiffs are seeking recission and restitution of funds, compensatory
damages, specific performance of the alleged contract, the formation of a
constructive trust in the Golden Eagle Mining properties and all Company stock
owned by Mr. Joseph Swisher and IMD, punitive damages for $1,000,000, and
several orders relating to the Golden Eagle Property, Silver Crystal Mines,
Inc., IMD and Mr. Swisher.
The lawsuit is on hold pending the plaintiffs locating a shareholder who will be
willing to represent a class of Silver Crystal shareholders in the action. There
are no specific claims or allegations made against the Company.
The Company is of the view that the allegations are generally without merit and
will continue to defend such actions vigorously.
CIVIL SUIT AGAINST GEOFFREY MAGNUSON
The Company commenced a lawsuit against Geoffrey Magnuson, a former officer of
the Company, in the District Court of the Second Judicial District of the State
of Idaho, in and for the County of Nez Perce on September 26, 1997. The Company
sued for diversion of corporate assets, conversion of corporate property,
including but not limited to, books, records and geological data, breach of
fiduciary duty and slander, and sought as relief:
(a) an order compelling Mr. Magnuson to account for his alleged
misconduct in appropriating the Company's property and to pay
to the Company the amount of such damage to the Company's
business and goodwill;
Page 8
<PAGE>
(b) an order mandating Mr. Magnuson to return all property
belonging to the Company and to pay to the Company the amount
of any damage to the Company.
On April 21, 1999, the Company filed a dismissal of this action, without
prejudice.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
Convertible Promissory Note Payable
On January 28, 1999, the Company as borrower, entered into Convertible Loan
Agreement #6 with the Tomasovich Family Trust as lender (the "Trust"), Theodore
Tomasovich being both Trustee of the Trust and a Director of the Company, for
$115,000 repayable on or before January 28, 2001 (the "Maturity Date") bearing
interest at 9% per annum. The Trust may require the Company to convert all or
any portion of the principal amount of the loan advanced and then outstanding
into units ("Units") at a conversion price of one Unit for each C$0.15 of
indebtedness until and including January 28, 2000 and at a conversion price of
one Unit for each C$0.20 of indebtedness during the period from January 29, 2000
until the Maturity Date for a maximum of 1,172,847 units if the principal amount
is converted in its entirety by January 28, 2000 and a maximum of 879,635 units
if the principal amount is converted in its entirety between January 29, 2000
and the Maturity Date. Each Unit consists of one common share and one
non-transferable common share purchase warrant with each warrant being
exercisable at a price of C$0.15 per share until January 28, 2000 and C$0.20 per
share from January 29, 2000 to the Maturity Date.
The Convertible Loan Agreement was accepted by the VSE on February 9, 1999. The
$115,000 convertible security instrument has been allocated $72,778 to notes
payable and $42,222 to equity based upon the fair value of the equity component.
Private Placement
On March 24, 1999 the VSE accepted for filing the Company's non-brokered Private
Placement of 2,000,000 units, each unit consisting of one common share and one
non-transferable warrant. Each warrant entitles the holder to purchase one
additional share at a price of C$0.15 per share in the first year until March
24, 2000 and C$0.18 per share in the second year until March 24, 2001. The
shares and warrants were issued effective March 29, 1999. The private places
were as follows:
Full Name and Residential Address of Purchaser Number of Units Purchased
- ---------------------------------------------- -------------------------
Delbert Steiner (1) 758,000
3555 Country Club Drive
Lewiston, Idaho
U.S.A. 83501
Jack Kennedy 200,000
P.O. Box 928
Venice, California
U.S.A. 90294
Stan Moore 100,000
1125 West 90th
Gardena, California
U.S.A. 90248
Cardinal Forestry Consulting Company Ltd. (2) 100,000
Beneficial Owner: Bernd Struck
2485 Orchard Road
Sidney, B.C.
V8L 1S1
Page 9
<PAGE>
Full Name and Residential Address of Purchaser Number of Units Purchased
- ---------------------------------------------- -------------------------
Paul Rohde 160,000
7415 N. Kenter Ave.
Los Angeles, California
U.S.A. 90049
Sterling Securities Ltd. 100,000
Beneficial Owner: Chris Bonvini
P.O.Box 753
Dartford, England
0427ZY
Mike Bousfield 200,000
Rosebanic the Street
Ridgehill, Near Winford
Bristol, England
B5188T8
Robert Rein 100,000
Suite 312 - 10000 Santa Monica Blvd.
Los Angeles, California
U.S.A. 90067
Brad Shaffer 100,000
600 California St., 8th Floor
San Francisco, California
U.S.A. 94108
Myron Forst 50,000
156215 New Century Drive
Gardena, California
U.S.A. 90248
Dave Consani 32,000
18732 Monte Vista Circle
Villa Park, California
U.S.A. 92861
Kenneth A. Scott, Inc. (3) 100,000
Beneficial Owner: Kenneth A. Scott
225 - 4299 Canada Way
Burnaby, B.C.
V5G 1H3
TOTAL 2,000,000
Note:
(1) Del Steiner is a director and senior officer of the Company.
(2) Bernd Struck is the brother of Wilfried Struck, who is Vice President,
Mining and Exploration, and Chief Operating Officer of the Company.
(3) Kenneth A. Scott, Inc. is owned by Kenneth A. Scott, the Chief Financial
Officer of the Company.
Page 10
<PAGE>
Conversion of Convertible Promissory Notes Payable
On January 20, 1999, the Tomasovich Family Trust as lender (the "Trust"),
Theodore Tomasovich being both Trustee of the Trust and a Director of the
Company, elected to convert $100,000 of the notes issued during 1998 for 546,154
units of the Company. Each unit consisted of one common share of the Company's
stock and one non-transferable share purchase warrant. The warrants allow the
holder to purchase additional common shares at C$0.31 per share to January 23,
2000.
On March 23, 1999, the Trust as lender elected to convert $110,000 of the notes
issued during 1998 for 600,769 units of the Company. Each unit consisted of one
common share of the Company's stock and one non-transferable share purchase
warrant. The warrants allow the holder to purchase additional common shares at
C$0.31 per share to March 31, 2000.
The Company reduced notes payable by $154,946, reduced convertible securities by
$27,527 and increased share capital by $182,473 on conversion of these notes.
The remaining $27,527 of equity remains in convertible securities until the
related warrants are exercised.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the quarter ended
March 31, 1999.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS FILED ON FORM 8-K
(a) Exhibit 27.
(b) None.
Page 11
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized, on the 15th day of July, 1999.
IDAHO CONSOLIDATED METALS CORPORATION
By: /s/ DELBERT W. STEINER
----------------------------------------
Delbert W. Steiner
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities indicated on the 15th day of July, 1999.
Signature Title Date
/s/ Delbert W. Steiner Director, President and July 15, 1999
- ------------------------------- Chief Executive Officer
Delbert W. Steiner
/s/ Kenneth A. Scott Chief Financial Officer July 16, 1999
- -------------------------------
Kenneth A. Scott
Page 12
<PAGE>
IDAHO CONSOLIDATED
METALS CORP.
(An Exploration Stage Company)
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
31 MARCH 1999
Unaudited - See Notice to Reader
U.S. Funds
STALEY, OKADA, CHANDLER & SCOTT
Chartered Accountants
<PAGE>
NOTICE TO READER
- --------------------------------------------------------------------------------
We have compiled the interim consolidated balance sheet of Idaho Consolidated
Metals Corp. as at 31 March 1999 and the interim consolidated statements of
changes in shareholders' equity, operations and cash flow for the three months
then ended from information provided by management. We have not audited,
reviewed or otherwise attempted to verify the accuracy or completeness of such
information. Readers are cautioned that these statements may not be appropriate
for their purposes.
A partner in Staley, Okada, Chandler & Scott is an officer of the Company.
Therefor, we are not independent from these interim consolidated financial
statements.
/s/ "Staley, Okada, Chandler & Scott"
Burnaby, B.C. STALEY, OKADA, CHANDLER & SCOTT
14 May 1999 CHARTERED ACCOUNTANTS
- --------------------------------------------------------------------------------
<PAGE>
Idaho Consolidated Metals Corp. Statement 1
(An Exploration Stage Company)
Interim Consolidated Balance Sheet
As at 31 March
U.S. Funds
Unaudited - See Notice to Reader
<TABLE>
ASSETS 1999 1998
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Current
Cash $ 14,892 $ 128,084
Accounts receivable 19,840 4,351
Cash in trust - 50,000
---------------- ---------------
34,732 182,435
Restricted Investments 92,000 90,000
Property Rights, Plant and Equipment 1,567,282 3,057,073
---------------- ---------------
$ 1,694,014 $ 3,329,508
- ---------------------------------------------------------------------------------------------------------------------
LIABILITIES
- ---------------------------------------------------------------------------------------------------------------------
Current
Accounts payable - Related parties $ 84,079 $ 193,362
- Other 172,936 161,911
Current portion of notes payable 15,789 254,243
---------------- ---------------
272,804 609,516
---------------- ---------------
Notes Payable 696,593 221,976
---------------- ---------------
SHAREHOLDERS' EQUITY
- ---------------------------------------------------------------------------------------------------------------------
Share Capital - Statement 2 7,891,066 7,508,593
Convertible Securities 264,557 -
Deficit - Accumulated during the exploration stage - Statement 2 (7,431,006) (5,010,577)
---------------- ---------------
724,617 2,498,016
---------------- ---------------
$ 1,694,014 $ 3,329,508
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
ON BEHALF OF THE BOARD:
"Robert Young", Director
"Delbert W. Steiner", Director
- See Accompanying Notes -
<PAGE>
Idaho Consolidated Metals Corp. Statement 2
Interim Consolidated Statement of Changes
In Shareholders' Equity
U.S. Funds
Unaudited - See Notice to Reader
<TABLE>
Deficit
Accumulated
Common Shares During the
-------------------------------- Convertible Exploration
Shares Amount Securities Stage Total
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balance - 31 December 1997 9,434,650 $ 7,508,593 $ - $ (4,866,470) $ 2,642,123
Loss for the period
- Statement 3 - - - (144,107) (144,107)
---------------------------------------------------------------------------------
Balance - 31 March 1998 9,434,650 $ 7,508,593 $ - $ (5,010,577) $ 2,498,016
- ---------------------------------------------------------------------------------------------------------------------
Balance - 31 December 1998 9,434,650 $ 7,508,593 $ 249,862 $ (7,263,201) $ 495,254
Shares issued on
conversion of promissory
notes 1,146,923 182,473 (27,527) - 154,946
Shares issued - private
placement 2,000,000 200,000 - - 200,000
Equity component on
issuance of convertible
securities - - 42,222 - 42,222
Loss for the period
- Statement 3 - - - (167,805) (167,805)
---------------------------------------------------------------------------------
Balance - 31 March 1999 112,581,573 $ 7,891,066 $ 264,557 $ (7,431,006) $ 724,617
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
- See Accompanying Notes -
<PAGE>
Idaho Consolidated Metals Corp. Statement 3
Interim Consolidated Statement of Operations
For the Three Months Ended 31 March
U.S. Funds
Unaudited - See Notice to Reader
<TABLE>
1999 1998
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operating Expenses
General and administrative - Schedule 1 $ 99,071 $ 135,596
--------------------------------------
Other (Income) Expenses
Interest income (301) (661)
Interest expense 60,582 9,172
Mineral property costs written off 8,453 -
--------------------------------------
68,734 8,511
--------------------------------------
Loss for the Period $ 167,805 $ 144,107
- ---------------------------------------------------------------------------------------------------------------------
Loss per Common Share $ 0.01 $ 0.02
- ---------------------------------------------------------------------------------------------------------------------
Weighted Average Number of Common Shares Outstanding 11,896,966 8,823,530
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
- See Accompanying Notes -
<PAGE>
Idaho Consolidated Metals Corp. Statement 4
Interim Consolidated Statement of Cash Flow
For the Three Months Ended 31 March
U.S. Funds
Unaudited - See Notice to Reader
<TABLE>
Cash Resources Provided By (Used In) 1999 1998
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operating Activities
Loss for the period $ (167,805) $ (144,107)
Item not affected by cash
Amortization 1,593 2,276
Amortization of interest discount 37,530 -
Changes in current assets and liabilities
Cash in trust 50,000 -
Accounts receivable (17,777) (363)
Accounts payable - Related parties (44,608) 12,370
- Other (54,772) 7,337
--------------------------------------
Net cash used in operating activities (195,839) (122,487)
--------------------------------------
Investing Activities
Restricted investments (2,000) -
Property rights, plant and equipment (102,676) (37,313)
--------------------------------------
Net cash used in investing activities (104,676) (37,313)
--------------------------------------
Financing Activities
Notes payable 72,778 208,999
Net proceeds from issuance of convertible securities 42,222 -
Share capital 200,000 -
--------------------------------------
Net cash provided by financing activities 315,000 208,999
--------------------------------------
Net increase in Cash 14,485 49,199
Cash position - Beginning of period 407 78,885
--------------------------------------
Cash Position - End of Period $ 14,892 $ 128,084
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
- See Accompanying Notes -
<PAGE>
Idaho Consolidated Metals Corp. Schedule 1
Interim Consolidated Schedule of Administrative Expenses
For the Three Months Ended 31 March
U.S. Funds
Unaudited - See Notice to Reader
<TABLE>
1999 1998
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Professional fees $ 35,392 $ 32,654
Management fees and wages 25,379 54,889
Travel 15,831 17,233
Office and general 9,930 9,587
Office rent 5,379 6,383
Transfer agent and filing fees 3,276 1,853
Shareholder information 1,842 10,368
Amortization 1,593 2,276
Entertainment and promotion 449 353
--------------------------------------
Expenses for the Period $ 99,071 $ 135,596
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
Interim Consolidated Schedule of Resource Property Costs Schedule 2
For the Three Months Ended 31 March
U.S. Funds
Unaudited - See Notice to Reader
<TABLE>
1999 1998
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Direct - Mineral
Idaho County, Idaho, U.S.A.
Lease payments and acquisition costs $ 11,600 $ 12,600
Geological 8,304 14,681
Taxes, licenses and permits 1,411 184
Environmental 710 -
Field transportation 378 -
Survey - 4,278
Camp and general - 3,680
Staking, filing and claim rental - 1,890
Montana, U.S.A.
Staking, filing and claim rental 26,540 -
Geological 22,672 -
Assaying 14,160 -
Field transportation 11,260 -
Survey 2,953 -
Environmental 1,819 -
Camp and general 869 -
--------------------------------------
Costs for the Period $ 102,676 $ 37,313
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
- See Accompanying Notes -
<PAGE>
Idaho Consolidated Metals Corp.
Notes to Interim Consolidated Financial Statements
31 March 1999
U.S. Funds
Unaudited - See Notice to Reader
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
The notes to the consolidated financial statements as at 31 December 1998,
as set forth in the company's 1998 Annual Report substantially apply to
these interim consolidated financial statements and are not repeated here.
- --------------------------------------------------------------------------------
2. Interim Consolidated Financial Statements Adjustments
The financial information given in the accompanying unaudited interim
consolidated financial statements reflects all adjustments which are, in
the opinion of management, necessary to a fair statement of the results for
the interim periods reported. All such adjustments are of a normal
recurring nature. All financial statements presented herein are unaudited.
- --------------------------------------------------------------------------------
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-mos
<FISCAL-YEAR-END> Dec-31-1998
<PERIOD-END> Mar-31-1999
<CASH> 14,892
<SECURITIES> 0
<RECEIVABLES> 19,840
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 34,732
<PP&E> 1,610,628
<DEPRECIATION> 43,346
<TOTAL-ASSETS> 1,694,014
<CURRENT-LIABILITIES> 272,804
<BONDS> 0
0
0
<COMMON> 7,891,066
<OTHER-SE> 264,557
<TOTAL-LIABILITY-AND-EQUITY> 1,694,014
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 167,805
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 60,582
<INCOME-PRETAX> (167,805)
<INCOME-TAX> 0
<INCOME-CONTINUING> (167,805)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (167,805)
<EPS-BASIC> (0.01)
<EPS-DILUTED> (0.01)
</TABLE>
